<SUBMISSION>
<ACCESSION-NUMBER>0000950144-03-007350
<TYPE>PRER14A
<PUBLIC-DOCUMENT-COUNT>3
<FILING-DATE>20030530
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>PERSONNEL GROUP OF AMERICA INC
<CIK>0000948850
<ASSIGNED-SIC>7363
<IRS-NUMBER>561930691
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>0103
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>PRER14A
<ACT>34
<FILE-NUMBER>001-13956
<FILM-NUMBER>03724288
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>5605 CARNEGIE BLVD
<STREET2>STE 500
<CITY>CHARLOTTE
<STATE>NC
<ZIP>28209
<PHONE>7044425100
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>5605 CARNEGIE BLVD
<STREET2>SUITE 500
<CITY>CHARLOTTE
<STATE>NC
<ZIP>28209
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>PRER14A
<SEQUENCE>1
<FILENAME>g82690p1prer14a.htm
<DESCRIPTION>PERSONNEL GROUP OF AMERICA, INC.
<TEXT>
<HTML>
<HEAD>
<TITLE>Personnel Group of America, Inc.</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV align="center">
<B><FONT size="2">SCHEDULE 14A<br>
INFORMATION REQUIRED IN PROXY
STATEMENT<BR>
SCHEDULE 14A INFORMATION
</FONT></B>
</DIV>
<P align="center"><FONT size="2">Proxy Statement Pursuant to
Section 14(a)<BR>of
the Securities Exchange Act of 1934 (Amendment No. 1)
</FONT>

<P align="left">
<FONT size="2">Filed by the Registrant&nbsp;
<FONT face="wingdings">&#120;</FONT>
</FONT>
<DIV align="left"><FONT size="2">Filed by a Party other than the Registrant&nbsp;
<FONT face="wingdings">&#111;</FONT></FONT></DIV>

<P align="left"><FONT size="2">Check the appropriate box:</FONT>

<CENTER>
<TABLE width="100%" align="center" cellspacing="0" cellpadding="0" border="0">
<TR>
        <TD width="49%" align="left" valign="top">
        <FONT size="2"><FONT face="wingdings">&#120;</FONT>&nbsp;&nbsp;Preliminary
        Proxy Statement
        </FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="48%"><FONT size="2">&nbsp;</FONT></TD>
        </TR>
<TR>
        <TD colspan="3" align="left" valign="top">
        <FONT size="2"><FONT face="wingdings">&#111;</FONT>&nbsp;&nbsp;Confidential,
        for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
        </FONT>
        </TD>
</TR>

<TR>
        <TD colspan="3" align="left" valign="top">
        <FONT size="2"><FONT face="wingdings">&#111;</FONT>&nbsp;&nbsp;Definitive
        Proxy Statement
        </FONT></TD>
</TR>

<TR>
        <TD colspan="3" align="left" valign="top">
        <FONT size="2"><FONT face="wingdings">&#111;</FONT>&nbsp;&nbsp;Definitive
        Additional Materials
        </FONT></TD>
</TR>

<TR>
        <TD colspan="3" align="left" valign="top">
        <FONT size="2"><FONT face="wingdings">&#111;</FONT>&nbsp;&nbsp;Soliciting
        Material under Rule 14a-12
        </FONT></TD>
</TR>
</TABLE>
</CENTER>

<P align="center"><FONT size="2"><B>PERSONNEL GROUP OF AMERICA, INC.</B></font>
<HR size="1" noshade>
<DIV align="center">
<FONT size="2">(Name of Registrant as Specified In Its Charter)
</FONT>
</DIV>

<p><HR size="1" noshade>
<div align="center"><FONT size="2">(Name of Person(s) Filing Proxy Statement, if
other than the Registrant)
</FONT></div>

<P align="left">
<FONT size="2">Payment of Filing Fee (Check the appropriate box):
</FONT>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
        <TD width="4%"></TD>
        <TD width="96%"></TD>
</TR>

<TR valign="top">
        <TD><FONT size="2"><FONT face="wingdings">&#120;</FONT></FONT></TD>
        <TD align="left">
        <FONT size="2">No fee required.
        </FONT></TD>
</TR>

<TR valign="top">
        <TD><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
        <TD align="left">
        <FONT size="2">Fee computed on table below per Exchange Act
        Rules&nbsp;14a-6(i)(1) and 0-11.
        </FONT></TD>
</TR>
</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
        <TD width="9%"></TD>
        <TD width="91%"></TD>
</TR>

<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1)</FONT></TD>
        <TD align="left"><FONT size="2">Title of each class of securities to which
        transaction applies:<br></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>

<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2)</FONT></TD>
        <TD align="left">
        <FONT size="2">Aggregate number of securities to which
        transaction applies:
        </FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>

<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3)</FONT></TD>
        <TD align="left">
        <FONT size="2">Per unit price or other underlying value of
        transaction computed pursuant to Exchange Act Rule&nbsp;0-11
        (set forth the amount on which the filing fee is calculated and
        state how it was determined):
        </FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>

<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4)</FONT></TD>
        <TD align="left">
        <FONT size="2">Proposed maximum aggregate value of transaction:
        </FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>


<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5)</FONT></TD>
        <TD align="left">
        <FONT size="2">Total fee paid:
        </FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>

</TABLE>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
        <TD width="4%"></TD>
        <TD width="96%"></TD>
</TR>

<TR valign="top">
        <TD><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
        <TD align="left">
        <FONT size="2">Fee paid previously with preliminary materials.
        </FONT></TD>
</TR>
<TR>
        <TD>&nbsp;</TD>
</TR>

<TR valign="top">
        <TD><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
        <TD align="left">
        <FONT size="2">Check box if any part of the fee is offset as
        provided by Exchange Act Rule&nbsp; 0-11(a)(2) and identify the
        filing for which the offsetting fee was paid previously.
        Identify the previous filing by registration statement number,
        or the Form or Schedule and the date of its filing.
        </FONT></TD>
</TR>
</TABLE>
<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
        <TD width="9%"></TD>
        <TD width="91%"></TD>
</TR>

<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1)</FONT></TD>
        <TD align="left">
        <FONT size="2">Amount Previously Paid:
        </FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>

<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2)</FONT></TD>
        <TD align="left">
        <FONT size="2">Form, Schedule or Registration Statement No.:
        </FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>

<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3)</FONT></TD>
        <TD align="left">
        <FONT size="2">Filing Party:
        </FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>

<TR valign="top">
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4)</FONT></TD>
        <TD align="left">
        <FONT size="2">Date Filed:
        </FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2"></FONT></TD>
        <TD align="left"><br><HR size="1" noshade></td>
</tr>
</TABLE>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><IMG src="g82690p1g8269001.gif" alt="(PERSONNEL GROUP OF AMERICA, INC. LOGO)">
</FONT>

<P align="center"><FONT size="5"><B>Personnel Group of America, Inc.</B></FONT>

<P align="center"><FONT size="2"><B>FIVE LAKEPOINTE PLAZA, 2ND FLOOR<BR>
2709 WATER RIDGE PARKWAY<BR>
CHARLOTTE, NORTH CAROLINA 28217</B>
</FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="right"><FONT size="2">June ___, 2003</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="left"><FONT size="2">Dear Stockholder:</FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You are cordially invited to attend the 2003 annual meeting of the
stockholders of Personnel Group of America, Inc., to be held at the Wyndham
Garden Hotel, 2600 Yorkmont Road, Charlotte, North Carolina 28208, on
_______________, July ___, 2003, at 9:30 a.m., local time.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Notice of Meeting and Proxy Statement for the annual meeting are
attached hereto. A copy of our 2002 Annual Report to Stockholders is also
attached. The matters to be acted upon by our stockholders at the annual
meeting are set forth in the Notice of Meeting and discussed in detail in the
Proxy Statement.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We would appreciate your signing, dating and returning the enclosed proxy
card in the envelope provided at your earliest convenience. If you choose to
attend the annual meeting, you may revoke your proxy and personally cast your
votes at the annual meeting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We look forward to seeing you at the annual meeting.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="50%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="50%"><FONT size="2">Sincerely yours,</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="50%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="50%"><FONT size="2">Larry L. Enterline<BR>
<I>Chief Executive Officer</I></FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>PERSONNEL GROUP OF AMERICA, INC.</B></FONT>

<P align="center"><FONT size="2"><B>NOTICE OF 2003 ANNUAL MEETING OF STOCKHOLDERS</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2"><B>To be held on ___________, July __, 2003</B></FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P>
<HR width="26%" align="center" size="1" noshade>
<P>


<P align="left"><FONT size="2">To the stockholders of Personnel Group of America, Inc.:</FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOTICE IS HEREBY GIVEN that the 2003 annual meeting of the stockholders of
Personnel Group of America, Inc., a Delaware corporation, will be held at 9:30
a.m., local time, on July &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2003, at the Wyndham Garden Hotel, 2600 Yorkmont
Road, Charlotte, North Carolina 28208, for the following purposes:
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">1.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To elect three members to our board of directors, each to serve until his
successor is duly elected and qualified;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">2.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve and adopt a new incentive plan to replace our existing stock
option plan;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="1">

</FONT></TD>
</TR>

<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">3.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to effect a
reverse stock split of our common stock at a one-for-twenty-five ratio;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">4.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to eliminate
the provision separating our board of directors into three classes;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">5.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to eliminate
the provision prohibiting action by consent of our common stockholders
without a meeting;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">6.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to elect that
we not be governed by Section&nbsp;203 of the Delaware General Corporation Law;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">7.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to require
approval by disinterested stockholders of transactions that would increase
the proportionate ownership of a stockholder that beneficially owns 20% or
more of the shares of our capital stock;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">8.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to require
approval by 5% stockholders and 80% of the directors of corporate
transactions involving a stockholder that beneficially owns 20% or more of
the shares of our capital stock;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">9.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to add
provisions requiring a supermajority vote of our board of directors or
stockholders to adopt changes to our certificate of incorporation or
bylaws;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">10.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to set the
number of directors between seven and nine, with the exact number to be
set in accordance with the bylaws;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">11.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment to our certificate of incorporation to provide
indemnification rights, including rights to advancement of expenses, to
directors and officers to the fullest extent permitted by law and to
permit the board to authorize indemnification of employees and agents;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">12.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To approve an amendment and restatement of our certificate of
incorporation to include the foregoing amendments in the event they are
approved by the stockholders and to make other</FONT></TD>
</TR>
</TABLE>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD><FONT size="1">

</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">&nbsp;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">amendments set forth in the form of our proposed restated certificate of
incorporation attached as Annex A to the proxy statement provided
herewith; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">13.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">To ratify the selection of PricewaterhouseCoopers LLP as our independent
auditors for 2003.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">Approval of each of the proposals 3 through 12 is conditioned upon the approval
of all of those proposals. Therefore, we believe proposals 3 through 12 should
be considered together. If any of proposals 3 through 12 is not approved,
none of them will be approved, even if one or more of those proposals receives
sufficient stockholder votes for approval.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At the annual meeting, our stockholders will also consider and act upon
any and all other business that may properly come before the annual meeting or
any adjournment of the meeting.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Holders of record of our common stock or our outstanding preferred stock
at the close of business on June&nbsp;20, 2003 are entitled to notice of and to vote
at the annual meeting. You may examine a list of those stockholders at our
principal executive offices at Five LakePointe Plaza, 2nd Floor, 2709 Water
Ridge Parkway, Charlotte, North Carolina 28217, during the 10-day period
preceding the annual meeting. Each share of our outstanding common stock will
entitle the holder thereof to one vote on each matter that may properly come
before the annual meeting. Each share of our outstanding preferred stock will
entitle the holder thereof to 100 votes on each such matter, which represents
one vote for each share of our common stock into which the share of preferred
stock is then convertible.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The accompanying proxy statement provides you with a summary of the
proposals on which our stockholders will vote at the annual meeting. Please
give all of this information your careful attention. Your vote is important
regardless of the number of shares that you own. Whether or not you expect to
be present at the annual meeting, please sign, date and return the enclosed
proxy card in the enclosed pre-addressed envelope as promptly as possible. No
postage is required if it is mailed in the United States.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="50%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="50%"><FONT size="2">By order of the Board of Directors,</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="50%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="50%"><HR size="1" noshade><FONT size="2">Ken R. Bramlett, Jr.<BR>
<I>Secretary</I></FONT></TD>
</TR>
</TABLE>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">Charlotte, North Carolina<BR>
June ___, 2003
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2"><B>ALL STOCKHOLDERS ARE INVITED TO ATTEND OUR 2003 ANNUAL MEETING IN PERSON.
THOSE STOCKHOLDERS WHO ARE UNABLE TO ATTEND ARE URGED TO EXECUTE AND RETURN THE
ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE. STOCKHOLDERS WHO EXECUTE A PROXY
CARD MAY NEVERTHELESS ATTEND THE ANNUAL MEETING, REVOKE THEIR PROXIES AND VOTE
THEIR SHARES IN PERSON.</B>
</FONT>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>2003 ANNUAL MEETING OF STOCKHOLDERS<BR>
OF<BR>
PERSONNEL GROUP OF AMERICA, INC.<BR>
_____________________</B></FONT>

<P align="center"><FONT size="2"><B>PROXY STATEMENT<BR>
_____________________</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This proxy statement is furnished in connection with the solicitation of
proxies by the board of directors of Personnel Group of America, Inc., a
Delaware corporation (the &#147;Company&#148; or &#147;we&#148; or &#147;us&#148;), from the holders of our
capital stock, for use at the 2003 annual meeting of our stockholders to be
held at the Wyndham Garden Hotel, 2600 Yorkmont Road, Charlotte, North Carolina
28208, at 9:30 a.m., local time, on July &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2003, or at any adjournments or
postponements of that meeting. The approximate date that this proxy statement
and the enclosed form of proxy are first being sent or given to our
stockholders is June &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2003. Our principal executive offices are located at
Five LakePointe Plaza, 2nd Floor, 2709 Water Ridge Parkway, Charlotte, North
Carolina 28217, and our telephone number there is (704)&nbsp;442-5100.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At this annual meeting, our stockholders will consider the following
proposals:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">1.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to elect Victor E. Mandel, James V. Napier and William J.
Simione, Jr. as directors, each to serve until his successor is duly
elected and qualified;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">2.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve and adopt a new incentive plan to replace our
existing stock option plan;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="1">

</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">3.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
effect a reverse stock split of our common stock at a one-for-twenty-five
ratio;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">4.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
eliminate the provision separating our board of directors into three
classes;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">5.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
eliminate the provision prohibiting action by consent of our common
stockholders without a meeting;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">6.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
elect that we not be governed by Section&nbsp;203 of the Delaware General
Corporation Law;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">7.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
require approval by disinterested stockholders of transactions that would
increase the proportionate ownership of a stockholder that beneficially
owns 20% or more of the shares of our capital stock;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">8.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
require approval by 5% stockholders and 80% of the directors of corporate
transactions involving a stockholder that beneficially owns 20% or more of
the shares of our capital stock;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">9.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
add provisions requiring a supermajority vote of our board of directors or
stockholders to adopt changes to our certificate of incorporation or
bylaws;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">10.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
set the number of directors between seven and nine, with the exact number
to be set in accordance with the bylaws;</FONT></TD>
</TR>
</TABLE>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">1</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD><FONT size="1">

</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">11.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment to our certificate of incorporation to
provide indemnification rights, including rights to advancement of
expenses, to directors and officers to the fullest extent permitted by law
and to permit the board to authorize indemnification of employees and
agents;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">12.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to approve an amendment and restatement of our certificate of
incorporation to include the foregoing amendments in the event they are
approved by the stockholders and to make other amendments set forth in the
form of our proposed restated certificate of incorporation attached as
Annex A to this proxy statement; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">13.</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A proposal to ratify the selection of PricewaterhouseCoopers LLP as our
independent auditors for 2003.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">Approval of each of the proposals 3 through 12 is conditioned upon the approval
of all of those proposals. Therefore, proposals 3 through 12 should be
considered together. If any of the proposals 3 through 12 is not approved,
none of them will be approved, even if one or more of those proposals receives
sufficient stockholder votes for approval.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At the annual meeting, our stockholders will also consider and act upon
any and all other business that may properly come before the annual meeting or
any adjournment of that meeting.
</FONT>
<P align="center"><FONT size="2"><B>THE ANNUAL MEETING</B></FONT>

<P align="left"><FONT size="2"><B>Date, Time, Place and Purpose</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This proxy statement and the accompanying form of proxy are being
furnished to holders of our common stock, par value $0.01 per share, and our
Series&nbsp;B Convertible Participating Preferred Stock, par value $0.01 per share
(which we refer to as our Series&nbsp;B preferred stock), in connection with the
solicitation of proxies by our board of directors for use at our 2003 annual
meeting of stockholders to be held on July ___, 2003, at the Wyndham Garden
Hotel, 2600 Yorkmont Road, Charlotte, North Carolina 28208, commencing at 9:30
a.m., local time, and at any adjournment or postponement of that meeting. At
the meeting, holders of our common stock and Series&nbsp;B preferred stock will be
asked to consider and vote on the proposals described in this proxy statement.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>Record Date and Quorum Requirement</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our board of directors has fixed the close of business on June&nbsp;20, 2003 as
the record date for the determination of stockholders entitled to notice of and
to vote at the annual meeting. Accordingly, only holders of record of shares
of our common stock and Series&nbsp;B preferred stock at the close of business on
the record date will be entitled to notice of, and to vote at, the annual
meeting. At the close of business on the record date, there were 47,821,637
shares of our common stock outstanding and entitled to vote, held by
approximately 5,071 beneficial holders, and 1,044,433 shares of our Series&nbsp;B
preferred stock outstanding and entitled to vote, held by approximately 27
beneficial owners.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each holder of record of shares of our common stock on the record date is
entitled to cast one vote per share on each proposal properly submitted for the
vote of the stockholders at the annual meeting. Each holder of record of
shares of our Series&nbsp;B preferred stock on the record date is entitled to cast
100 votes on each of these proposals for each share of Series&nbsp;B preferred stock
then held by such holder, which is equivalent to one vote for each share of
common stock into which such share of Series&nbsp;B preferred stock is then
convertible. Votes may be cast either in person or by properly executed proxy.
</FONT>
<P align="center"><FONT size="2">2</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The presence in person or by properly executed proxy of the holders of a
majority of the outstanding shares of common stock and Series&nbsp;B preferred stock
on the record date, taken together as a single class, is necessary to
constitute a quorum for the transaction of business at the meeting. For
purposes of determining whether we have a quorum, each share of Series&nbsp;B
preferred stock will be deemed to represent 100 shares of common stock. If a
quorum is not present at the annual meeting, the stockholders present may
adjourn the annual meeting from time to time, without notice other than by
announcement at the meeting, until a quorum is present or represented. Shares
represented by proxies that are marked ABSTAIN and broker &#147;non-votes&#148; will be
counted as present for the purpose of determining the presence or absence of a
quorum at the meeting. A broker &#147;non-vote&#148; occurs when a broker holding shares
for a beneficial owner does not vote on a particular proposal because the
broker does not have discretionary voting power for that particular item and
has not received instructions from the beneficial owner.
</FONT>
<P align="left"><FONT size="2"><B>Required Vote; Broker Voting Procedures</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Directors will be elected by a plurality of the voting power present in
person or represented by proxy and entitled to vote at the annual meeting.
Each share of Series&nbsp;B preferred stock will count as the number of outstanding
shares of our common stock into which it is then convertible. Votes may be
cast either FOR each director nominee or to WITHHOLD AUTHORITY for each
director nominee separately. Only shares that are voted in favor of a
particular nominee will be counted towards that nominee&#146;s achievement of a
plurality. Thus, shares represented at the annual meeting that are not voted
for a particular nominee, shares present in person or represented by proxy
where the stockholder properly withholds authority to vote for the nominee, and
broker non-votes, if any, will not be counted towards the nominee&#146;s achievement
of a plurality.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Approval of proposal 2 and proposal 13, regarding our new incentive plan
and the ratification of our independent auditors, requires the affirmative vote
of a majority of the shares of our capital stock represented at the meeting and
entitled to vote on the proposal. Each share of Series&nbsp;B preferred stock will
count as the number of outstanding shares of our common stock into which it is
then convertible. If a stockholder abstains from voting its shares or directs
the stockholder&#146;s proxy to abstain from voting its shares on these proposals,
the shares will be considered present and entitled to vote but will have the
same effect as votes against the proposals. On the other hand, broker
non-votes, if any, will not be considered present and entitled to vote and will
have no effect on the outcome of the vote. However, broker non-votes will have
the practical effect of reducing the number of affirmative votes required to
achieve a majority for these proposals by reducing the total number of shares
from which the majority is calculated.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Approval of proposals 3 through 12, each regarding amendment of our
certificate of incorporation, requires the affirmative vote of the holders of a
majority of the outstanding shares of our capital stock. For this purpose,
each share of Series&nbsp;B preferred stock will count as the number of outstanding
shares of our common stock into which the share of Series&nbsp;B preferred stock is
then convertible. Abstentions effectively count as negative votes on this
proposal. <B>A failure to vote (other than a broker non-vote) or a vote to
abstain will have the same legal effect as a vote cast against approval of our
amended and restated certificate of incorporation. </B>In addition, we have
conditioned approval of each of proposals 3 through 12 on approval of all of
those proposals. If any of proposals 3 through 12 is not approved, none of
them will be approved, even if one or more of those proposals receives
sufficient stockholder votes for approval.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>Voting and Revocation of Proxies</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The enclosed proxy provides that shares of common stock and Series&nbsp;B
preferred stock may be voted FOR the director nominees or to WITHHOLD AUTHORITY
for the nominees and FOR, AGAINST or ABSTAIN from voting with respect to the
other proposals. The board of directors recommends that you vote FOR each of
the three director nominees named in this proxy statement, FOR
</FONT>
<P align="center"><FONT size="2">3</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">the adoption of the new equity incentive plan, FOR adoption of the amendments
to our certificate of incorporation and FOR ratification of the selection of
independent auditors. In addition, three of the entities to which we issued
capital stock in our recent financial restructuring, which together hold more
than 45% of the voting power of our outstanding capital stock, have agreed to
vote FOR adoption of the amendments to our certificate of incorporation
described in proposals 3 through 12.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares of our stock represented by properly executed proxies received at
or prior to the meeting and not revoked will be voted in the manner specified
on such proxies. Properly executed proxies that do not contain voting
instructions will be voted FOR election of each of the nominees for director
and FOR approval and adoption of each of the other proposals. Properly
executed proxies marked ABSTAIN, although counted for purposes of determining
whether there is a quorum at the meeting, will not be voted.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At the date of this proxy statement, the board of directors does not know
of any business to be presented at the meeting other than as set forth in the
notice accompanying this proxy statement. If any other matters should properly
be presented at the meeting for consideration, the persons named in the
enclosed form of proxy and acting thereunder will have discretion to vote on
such matters in accordance with their best judgment.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A stockholder giving a proxy has the power to revoke it at any time before
the vote is taken at the annual meeting by:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">submitting to the Secretary of the Company a written instrument revoking the proxy;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">submitting a duly executed proxy bearing a later date; or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">voting in person at the annual meeting.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any written notice of revocation or subsequent proxy should be sent so as
to be delivered to us at Five LakePointe Plaza, 2nd Floor, 2709 Water Ridge
Parkway, Charlotte, North Carolina 28217, Attention: Secretary, or
hand-delivered to our Secretary at that address, at or before the taking of the
vote at the annual meeting.
</FONT>
<P align="left"><FONT size="2"><B>Solicitation of Proxies</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proxies are being solicited on behalf of our board of directors. We will
pay the costs and expenses incurred in connection with the printing and mailing
of this proxy statement and the solicitation of the enclosed proxy. In
addition to solicitation by mail, our directors, officers and employees may
solicit proxies in person or by telephone, telegram or other means of
communication. Our directors, officers and employees will receive no
additional compensation for such services, but we may reimburse them for
reasonable out-of-pocket expenses in connection with such solicitation.
Brokers, custodians, nominees and fiduciaries will be requested to forward
proxy solicitation materials to the beneficial owners of shares held of record
by them, and we will reimburse them for the reasonable, out-of-pocket expenses
they incur in doing so. We have also retained Corporate Communications, Inc.
of Nashville, Tennessee, to aid in the proxy solicitation at an estimated cost
of $5,000, plus expenses.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Holders of our common stock should not send stock certificates with their
proxy cards. If we implement the reverse stock split described under
&#147;Proposals 3 through 12&#151;Charter Amendments&#151;Proposal
3&#151;Reverse Stock Split,&#148;
common stockholders will be provided with instructions and a letter of
transmittal relating to the exchange of their common stock certificates
following the effective date of the reverse stock split.</B>
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">4</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="left"><FONT size="2"><B>Appraisal Rights</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Neither our certificate of incorporation nor the laws of the State of
Delaware provide appraisal rights or any other statutory remedy to dissenting
stockholders in connection with any of the proposals being voted upon at the
annual meeting.
</FONT>
<P align="center"><FONT size="2"><B>PROPOSAL 1 &#151; ELECTION OF DIRECTORS</B></FONT>

<P align="left"><FONT size="2"><B>Current Board</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our current certificate of incorporation and bylaws provide for seven
directors who are divided into three classes. On April&nbsp;14, 2003, in connection
with our restructuring, Kevin P. Egan, James C. Hunt and J. Roger King resigned
from our board. In accordance with our bylaws, the board named Victor E.
Mandel, Christopher R. Pechock and Elias J. Sabo to fill the resulting
vacancies. The board also changed the class designation of James V. Napier and
William J. Simione, Jr. from Class&nbsp;III to Class&nbsp;II and the designation of
Janice L. Scites from Class&nbsp;II to Class&nbsp;III. As the board is now constituted,
the terms of the Class&nbsp;I directors, Mr.&nbsp;Pechock and Mr.&nbsp;Sabo, expire at the
2005 annual meeting of stockholders, and the terms of the Class&nbsp;III directors,
Larry L. Enterline and Janice L. Scites, expire at the 2004 annual meeting.
Victor E. Mandel, James V. Napier and William J. Simione, Jr. are the current
Class&nbsp;II directors, and their terms expire at this annual meeting.
</FONT>
<P align="left"><FONT size="2"><B>Nominees</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Governance Committee has nominated Victor E. Mandel, James V. Napier
and William J. Simione, Jr. for election as Class&nbsp;II directors. In accordance
with our bylaws, the Governance Committee consists of two directors who were
designated by the group of our stockholders that own 20% or more of our voting
capital stock (Mr.&nbsp;Pechock and Mr.&nbsp;Sabo) and one additional independent
director (Ms.&nbsp;Scites). The board of directors has no reason to believe that
any of the three nominees will refuse to act or be unable to accept election.
If any unforeseen contingencies should arise, however, each proxy will be voted
for such other person or persons as the board may designate unless the proxy
specifically directs otherwise.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If at this annual meeting our stockholders approve the changes to our
certificate of incorporation contained in proposals 3 through 12, which have the effect,
among others, of eliminating our classified board structure, the terms of all
of our directors, including the three elected at this annual meeting, will
expire at the 2004 annual meeting. If our stockholders do not approve
proposals 3 through 12, the directors elected at this meeting will serve terms that expire at our
2006 annual meeting, and the other directors will continue to serve the terms
described above. See &#147;Proposals 3 through 12&#151;Charter
Amendments&#151;Proposal
4&#151;Eliminate Classification of the Board of Directors.&#148;
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our bylaws prescribe the procedure a stockholder must follow to make
nominations for director candidates, as described below under &#147;Stockholders&#146;
Proposals.&#148;
</FONT>
<P align="left"><FONT size="2"><B>Vote Required</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Directors will be elected by a plurality of the voting power present in
person or represented by proxy and entitled to vote at the annual meeting.
Each share of Series&nbsp;B preferred stock will count as the number of outstanding
shares of our common stock into which it is then convertible. Votes may be
cast either FOR each director nominee or to WITHHOLD AUTHORITY for each
director nominee separately. Only shares that are voted in favor of a
particular nominee will be counted towards that nominee&#146;s achievement of a
plurality. Thus, shares represented at the annual meeting that are not voted
for a particular nominee, shares present in person or represented by proxy
where the stockholder properly
</FONT>
<P align="center"><FONT size="2">5</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">withholds authority to vote for the nominee, and broker non-votes, if any,
will not be counted towards the nominee&#146;s achievement of a plurality.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This proposal is not conditioned upon the approval of any of the other
proposals described in this proxy statement. Under Delaware law and the
provisions of our certificate of incorporation and bylaws, you are not entitled
to dissenters&#146; rights of appraisal with respect to the election of our
directors.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Our board of directors believes the election of the three nominees named
above is in the best interests of the Company and its stockholders and
recommends that you vote FOR each of the nominees. Each proxy card executed
and returned will be voted FOR each of the nominees unless contrary
instructions are indicated on the proxy card.</B>
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The principal occupation and certain other information (including age as
of the date of the proxy statement) about these nominees and other directors of
the Company whose terms of office continue after the annual meeting are set
forth below, along with information about the Company&#146;s executive officers.
</FONT>
<P align="center"><FONT size="2"><B>MANAGEMENT INFORMATION</B></FONT>

<P align="left"><FONT size="2"><B>Nominees for Class&nbsp;II Directors</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Victor E. Mandel: </I>Mr.&nbsp;Mandel, age 38, has served as a director since the
completion of our financial restructuring in April 2003. Since 2001, Mr.
Mandel has served as founder and Managing Member of Criterion Capital
Management, an investment company. From May 1999 to November 2000, Mr.&nbsp;Mandel
was Executive Vice President-Finance and Development of Snyder Communications,
Inc., with operating responsibility for its publicly-traded division
Circle.com. From June 1991 to May 1999, Mr.&nbsp;Mandel was a Vice President in the
Investment Research department at Goldman Sachs &#038; Co. covering emerging growth
companies.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>James V. Napier: </I>Mr.&nbsp;Napier has served as a director since September
1995. He is currently chair of the Audit Committee. From November 1992 to
November 2000, Mr.&nbsp;Napier served as the Chairman of Scientific-Atlanta, Inc., a
telecommunications company. In addition to serving on the Boards of directors
of the Company and Scientific-Atlanta, Mr.&nbsp;Napier serves on the Boards of
directors of Engelhard Corporation, Vulcan Materials Company, McKesson
Corporation, Intelligent Systems Corporation and WABTEC Corp.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>William J. Simione, Jr.: </I>Mr.&nbsp;Simione, age 61, has served as a director
since September 1995. From January 1996 to October 2001, Mr.&nbsp;Simione served as
President of Simione Consulting, LLC, a subsidiary of CareCentric, Inc.
(formerly Simione Central Holdings, Inc.). Since October 2001, Mr.&nbsp;Simione has
served as managing principal of Simione Consulting, LLC, which provides
consulting services and information systems to the home healthcare industry.
Mr.&nbsp;Simione also serves on the board of directors of CareCentric, Inc. He is a
member of the Prospective Payment Task Force, a Regulatory Affairs Subcommittee
for the National Association for Home Care, and is one of the Subcommittee&#146;s
National Reimbursement Consultants.
</FONT>
<P align="left"><FONT size="2"><B>Class&nbsp;I Directors</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Christopher R. Pechock: </I>Mr.&nbsp;Pechock, age 38, has served as a director
since the completion of our financial restructuring in April 2003. He
currently serves on the Audit, Compensation, Executive and Governance
Committees. Since 1998, Mr.&nbsp;Pechock has served as a partner of one of our
stockholders, MatlinPatterson Global Opportunities Partners, an asset
management firm specializing in corporate restructurings, and its predecessor.
From 1996 to 1998, Mr.&nbsp;Pechock was employed by Turnberry Capital Management, a
capital management firm. Mr.&nbsp;Pechock has a Master&#146;s degree in business
administration
</FONT>
<P align="center"><FONT size="2">6</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">from Columbia Business School. Mr.&nbsp;Pechock also serves on the boards of
directors of Huntsman Holdings, Inc. and several private companies.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Elias J. Sabo: </I>Mr.&nbsp;Sabo, age 32, has served as a director since the
completion of our financial restructuring in April 2003. He currently serves
on the Audit, Executive and Governance Committees and as chair of the
Compensation Committee. Since 1998, Mr.&nbsp;Sabo has served as a founding partner
at The Compass Group International LLC. Prior to joining Compass, Mr.&nbsp;Sabo
worked in the acquisition department for Colony Capital, a Los Angeles-based
real estate private equity firm, from 1992 to 1996 and as a healthcare
investment banker for CIBC World Markets (formerly Oppenheimer &#038; Co.) from 1996
to 1998. Mr.&nbsp;Sabo also serves on the boards of directors of several private
companies.
</FONT>
<P align="left"><FONT size="2"><B>Class&nbsp;III Directors</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Larry L. Enterline: </I>Mr.&nbsp;Enterline, age 50, has served as our Chief
Executive Officer and as a director since December 2000, and now serves as
Chairman of our board of directors. He also chairs our Executive Committee.
From 1984 to 1989, Mr.&nbsp;Enterline served as Vice President of Marketing and
Sales with Bailey Controls. From 1989 to 1999, Mr.&nbsp;Enterline served in various
management roles with Scientific-Atlanta, Inc., most recently as a Senior Vice
President in charge of worldwide sales and service organization. Mr.&nbsp;Enterline
holds a bachelor&#146;s degree in electrical engineering and a Master&#146;s degree in
business administration.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Janice L. Scites</I>: Ms.&nbsp;Scites, age 52, has served as a director since
August 1999. She is currently chair of the Governance Committee and serves on
the Compensation Committee. Since 2000, Ms.&nbsp;Scites has served as President of
Scites Associates, Inc., an information technology and management consulting
firm. From 1995 to 2000, Ms.&nbsp;Scites served in various management roles with
AT&#038;T, initially as Vice President in its Business Customer Care and Value-Added
Services organizations and most recently as Vice President in the Internet
Implementation Strategy Group. Prior to joining AT&#038;T, Ms.&nbsp;Scites spent 13
years with Phoenix Mutual Life Insurance Company and five years with
Connecticut Mutual Life Insurance Company. Ms.&nbsp;Scites also serves on the board
of directors of Central Vermont Public Service Corporation, a Vermont-based
electric utility.
</FONT>
<P align="left"><FONT size="2"><B>Other Executive Officers</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>James C. Hunt: </I>Mr.&nbsp;Hunt, age 46, has served as our President and Chief
Financial Officer since January 2001. Prior to that time, Mr.&nbsp;Hunt served as
our President from October 1999 to January 2001, Chief Financial Officer and
Treasurer from March 1997 until October 1999 and Senior Vice President from
January 1997 until March 1997. Mr.&nbsp;Hunt served as a director from January 1997
to April 2003. Prior to joining us in January 1997, Mr.&nbsp;Hunt spent 18&nbsp;years
with Arthur Andersen LLP, a worldwide accounting and consulting firm, the last
six years as a partner.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Michael H. Barker: </I>Mr.&nbsp;Barker, age 48, has served as President of
Division Operations since January 2003. From January 2001 through January
2003, Mr.&nbsp;Barker served as President of our IT Services Division. Prior to
that time, Mr.&nbsp;Barker served as President of Divisional Operations from October
1999 to January 2001 and as President of the Commercial Staffing division from
January 1998 until October 1999. Prior to joining us, from 1995 to 1997 Mr.
Barker served as the Chief Operations Officer for the Computer Group Division
of IKON Technology Services, a diversified technology company.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Ken R. Bramlett, Jr.: </I>Mr.&nbsp;Bramlett, age 43, has served as our Senior Vice
President, General Counsel and Secretary since January 2001. Prior to that
time, Mr.&nbsp;Bramlett served as our Chief Financial Officer and Treasurer from
October 1999 to January 2001 and as our Senior Vice President, General Counsel
and Secretary from October 1996 until October 1999. Mr.&nbsp;Bramlett also served
as a director from
</FONT>
<P align="center"><FONT size="2">7</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">August 1997 to January 2001. Prior to joining us in October 1996, Mr.
Bramlett spent 12&nbsp;years with Robinson, Bradshaw &#038; Hinson, P.A., a Charlotte,
North Carolina law firm, the last six years as a partner. Mr.&nbsp;Bramlett serves
on the board of directors of World Acceptance Corporation, a small loan
consumer finance company headquartered in Greenville, South Carolina.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Thomas E. Stafford: </I>Mr.&nbsp;Stafford, age 58, has served as our Vice
President of Human Resources since January 2000. Prior to that time, Mr.
Stafford served as the Director of Human Resources for the Film and Fiber
Division of Hoechst Celanese Corporation from 1992 to April 1998 and as
Director of Benefits from April 1998 to April 1999.
</FONT>
<P align="center"><FONT size="2"><B>CORPORATE GOVERNANCE</B></FONT>

<P align="left"><FONT size="2"><B>Board Meetings and Committees</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During 2002, our board of directors held four regularly scheduled meetings
and took a number of actions by unanimous written consent. All incumbent
directors had perfect attendance at all meetings of our board of directors and
all meetings of board committees during 2002 to the extent such directors
served on such committees.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Audit Committee. </I>Mr.&nbsp;Napier, Ms.&nbsp;Scites and Mr.&nbsp;Simione served as members
of the Audit Committee of our board of directors in 2002. The Audit Committee
is responsible for, among other things, considering the appointment of our
independent auditors, reviewing with them the plan and scope of their audit and
audit fees, monitoring the adequacy of reporting and internal controls and
meeting periodically with internal and independent auditors. All of the
members of the 2002 Audit Committee satisfy the criteria for independence set
by Nasdaq. Our independent auditors have access to the Audit Committee at any
time. The Audit Committee met three times during 2002 and had separate
conference calls prior to each of our quarterly earnings releases during the
year.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mr.&nbsp;Napier (chair), Mr.&nbsp;Pechock and Mr.&nbsp;Sabo are the current members of
the Audit Committee. The Audit Committee&#146;s written charter is attached as
Annex B to this proxy statement.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Compensation Committee. </I>Kevin P. Egan and J. Roger King, who resigned
from the board in April 2003, and Mr.&nbsp;Napier served as members of the
Compensation Committee of our board of directors during 2002. The Compensation
Committee reviews proposals regarding the establishment of, or changes in,
benefits plans, salaries and other compensation of our executive officers and
other designated employees, advises management and makes recommendations to our
board of directors with respect to compensation for these individuals, and
administered our 1995 Equity Participation Plan, which we refer to as our 1995
Stock Option Plan (which was terminated in connection with our restructuring)
and Management Incentive Compensation Plan. It will also administer our 2003
Equity Incentive Plan, if our stockholders approve that plan at the annual
meeting. The Compensation Committee met two times during 2002.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mr.&nbsp;Sabo (chair), Mr.&nbsp;Pechock and Ms.&nbsp;Scites are the current members of
the Compensation Committee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Governance Committee. </I>Mr.&nbsp;Egan, Mr.&nbsp;King and Mr.&nbsp;Simione served as
members of the Governance Committee of our board of directors during 2002. The
Governance Committee provides general oversight of the governance of our board
of directors, makes recommendations concerning board size, make-up, structure
and compensation and recommends nominees for the board and its committees. The
Governance Committee met two times during 2002.
</FONT>
<P align="center"><FONT size="2">8</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ms.&nbsp;Scites (chair), Mr.&nbsp;Pechock and Mr.&nbsp;Sabo are the current members of
the Governance Committee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Special Committee. </I>Mr.&nbsp;Napier, Ms.&nbsp;Scites and Mr.&nbsp;Simione served as
members of a Special Committee of our board of directors during 2002 and the
first four months of 2003. The Special Committee was responsible for
considering actions in connection with possible strategic transactions we were
evaluating and with the comprehensive restructuring of our debt in April 2003.
The Special Committee met on numerous occasions in 2002.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Executive Committee. </I>The board has recently formed an Executive Committee
comprised of Mr.&nbsp;Enterline (chair), Mr.&nbsp;Pechock and Mr.&nbsp;Sabo.
</FONT>
<P align="left"><FONT size="2"><B>Director Compensation</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In 2002, Mr.&nbsp;Egan was paid $10,000 for his service as non-executive
Chairman of the board and $10,000 for special services as a director in
connection with our financial restructuring. Additionally, each non-employee
director received an annual retainer of $15,000, and an annual retainer of
$1,000 for each board committee he or she chaired. Non-employee directors also
received meeting fees of $1,000 per board meeting attended and $750 per
committee meeting attended, plus reimbursement of expenses. Members of the
Special Committee received an additional $10,000 for their service on that
committee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We offer a deferred fee plan for our non-employee directors under which
participating directors may defer any or all of their retainer and meeting fees
for specified time periods. The deferred fee plan is non-qualified for tax
purposes. Deferred fees under the plan earn interest at the prime rate or, at
each participating director&#146;s option, a return based on our stock price
performance over time. Each non-employee director, except for Mr.&nbsp;King,
elected to defer 100% of the retainer and meeting fees to which he or she
otherwise was entitled in 2002 under the deferred fee plan. None of our
directors have elected to participate in this plan for 2003.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of our 2002 directors also received an annual option grant to
purchase 3,000 shares of common stock in 2002 under our 1995 Stock Option Plan,
which required that the exercise price for options granted under the plan equal
the fair market value of our common stock on the date of grant. In connection
with the Company&#146;s recently completed financial restructuring, each of our 2002
directors (other than Mr.&nbsp;King) has irrevocably waived his or her right to
exercise all of his or her outstanding PGA stock options granted under the 1995
Stock Option Plan, including these options, and has forfeited all of such
options to the Company. Additionally, the 1995 Stock Option Plan has been
terminated. The Board is currently considering revising its program of
equity-based compensation for directors for 2003.
</FONT>
<P align="left"><FONT size="2"><B>Certain Relationships and Related Party Transactions</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;According to the most recent beneficial ownership reports they had filed
with the Securities and Exchange Commission, each of the following entities and
groups beneficially owned more than 5% of our capital stock prior to April&nbsp;14,
2003:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">a group that includes MatlinPatterson Global Opportunities
Partners L.P., or MatlinPatterson, and Inland Partners, L.P. and
Links Partners, L.P., two affiliated entities that we refer to
collectively as Inland/Links;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">a group that includes SC Fundamental Value Fund, L.P. and SC
Fundamental Value Fund BVI, Ltd., affiliated entities that we refer
to collectively as SC Fundamental Value; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Amalgamated Gadget, L.P., as
investment manager for R<SUP>2</SUP>
Investments, LDC.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">9</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>


<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On April&nbsp;14, 2003, we completed a comprehensive financial restructuring
with our senior credit facility lenders and the holders of approximately $109.7
million of our $115&nbsp;million outstanding 5.75% convertible subordinated notes
due 2004. The noteholders that participated in this restructuring included
MatlinPatterson, Inland/Links, SC Fundamental Value and R<SUP>2</SUP> Investments.
MatlinPatterson and Inland/Links also participated in their role as senior
credit facility lenders. The following is a brief summary of our material
restructuring transactions.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Note exchange. </I>In the restructuring, we issued shares of our common stock
and Series&nbsp;B preferred stock to the participating noteholders in a privately
negotiated exchange for their 5.75% notes. For each $1,000 in principal amount
of notes exchanged, the participating noteholders received:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">$28.75 in cash;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">190.9560 shares of newly issued shares of our common stock; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">9.5242 shares of our Series&nbsp;B preferred stock., each of which
is currently convertible into 100 shares of our common stock.</FONT></TD>
</TR>
</TABLE>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We issued to the participating noteholders a total of 20,940,425 shares of
our common stock and 1,044,433 shares of Series&nbsp;B preferred stock, which
together represented approximately 82% of the voting power of our then
outstanding voting stock. Of this total, we issued 5,779,952 shares of common
stock and 288,283 shares of Series&nbsp;B preferred stock to MatlinPatterson and
2,889,976 shares of common stock and 144,142 shares of Series&nbsp;B preferred stock
to each of Inland Partners and Links Partners. This resulted in the group
consisting of MatlinPatterson, Inland/Links and their affiliates beneficially
owning approximately 45.4% of the voting power of our outstanding capital stock
(excluding shares of our common stock underlying warrants issued to them as
senior lenders in connection with the amendment of our senior credit facility,
as described below). We issued 3,660,245 shares of common stock and 182,560
shares of Series&nbsp;B preferred stock to R<SUP>2</SUP> Investments, which resulted in R<SUP>2</SUP>
Investments beneficially owning approximately 14.4% of the voting power of our
outstanding capital stock. We issued a total of 381,922 shares of common stock
and 19,048 shares of Series&nbsp;B preferred stock to SC Fundamental Value, but the
aggregate issuances resulted in SC Fundamental Value beneficially owning less
than 5% of any class of our capital stock.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Reconstitution of board. </I>In connection with the note exchange, we agreed
to reconstitute our board to provide for seven members. The participating
noteholders designated two of these seven directors, Mr.&nbsp;Pechock and Mr.&nbsp;Sabo,
prior to the exchange. Mr.&nbsp;Pechock is a partner of MatlinPatterson, and Mr.
Sabo is a partner of The Compass Group International LLC, which is an affiliate
of Inland/Links. In addition, Mr.&nbsp;Sabo is part of the group that shares
investment authority with respect to the shares of our capital stock issued in
the restructuring to MatlinPatterson and Inland/Links.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As permitted by the agreement that governed our restructuring, the
participating noteholders also designated I. Joseph Massoud to attend meetings
of our board in a non-voting observer capacity. Mr.&nbsp;Massoud is another member
of the group that shares investment authority with respect to the shares of our
capital stock issued to MatlinPatterson and Inland/Links. The restructuring
agreement entitles Mr.&nbsp;Pechock to designate a board observer as well.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Of the other five directors that make up our reconstituted board, one is
our Chief Executive Officer, who is an incumbent director; one is an
independent, incumbent director whom we designated with the participating
noteholders&#146; consent; and the remaining three are independent directors (two of
whom are incumbents) whom the participating noteholders designated with our
consent. For more information about our reconstituted board, see &#147;Proposal
1&#151;Election of Directors&#148; and &#147;Management Information.&#148;
</FONT>
<P align="center"><FONT size="2">10</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Amendments to credit facility. </I>In order to permit the closing of the note
exchange and to provide for the terms on which our existing senior lenders
would continue to finance our working capital needs, we executed definitive
agreements with the existing senior lenders for amendments to our existing
credit facility. These agreements provided, among other things, for a 10%
reduction in the principal amount of debt owed under the facility and an
extension of the facility&#146;s maturity date. In connection with the amendments,
we used most of our cash on hand (after payment of expenses of the transactions
and after receipt of approximately $24.3&nbsp;million in recoverable income taxes
included in our March&nbsp;30, 2003 balance sheet) to repay outstanding borrowings
under the facility to the lenders on a pro rata basis. A total of $4,377,500
of the debt owed under the facility to MatlinPatterson and Inland/Links was
reduced, and they received a total of $16,143,625 from our repayment of
outstanding borrowings.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To replace equity appreciation rights we had granted to the senior lenders
in connection with earlier amendments to the credit facility, we issued common
stock purchase warrants to the lenders entitling them to purchase a total of
19,224,917 shares of common stock, equal to 10% of the outstanding common stock
on a fully diluted basis. These warrants are exercisable in whole or part over
a 10-year period, and their exercise price is $0.3121 per share (which was
based on a stated valuation for our equity of $60&nbsp;million). MatlinPatterson
and Inland/Links received a total of 8,170,589 of these warrants.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Registration rights agreement. </I>In connection with the restructuring, we
entered into an agreement with each of the former noteholders participating in
the note exchange and each of our senior lenders, including MatlinPatterson and
Inland/Links, to provide them with registration rights with respect to the
following shares of our common stock:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">shares issued in the exchange,</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">shares acquired upon conversion of the Series&nbsp;B preferred
stock issued in the exchange and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">shares acquired upon exercise of the warrants issued to the
senior lenders in connection with the amendments to our credit
facility.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Amendments to stockholder rights plan. </I>In connection with the
restructuring, we also amended and restated the stockholder rights plan that
governs the terms of preferred share purchase rights that currently accompany
our common stock. The amendments include, among other things, the following
additional exceptions to the definition of an &#147;Acquiring Person:&#148;
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">persons and entities that acquired beneficial ownership of
our capital stock in exchange for the 5.75% notes, including
MatlinPatterson and Inland/Links;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">any &#147;significant holder&#148; that acquired capital stock in
compliance with our amended and restated certificate of
incorporation, and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">transferees of a significant holder that acquired capital
stock in compliance with our amended and restated certificate of
incorporation.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">A &#147;significant holder&#148; is one that beneficially owns 20% or more of the shares
of our capital stock that are entitled to vote on matters submitted to a vote
of our stockholders, or voting stock. Both MatlinPatterson and Inland/Links
are currently significant holders under this definition.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, the stockholder rights plan was amended to include a
tag-along right for the benefit of any holder (including certain holders of
more than 2% acting together as a group) of 5% or more of our voting stock.
This tag-along right entitles each 5% holder (or group) to participate pro
rata, for the same
</FONT>
<P align="center"><FONT size="2">11</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">amount and form of consideration and otherwise on substantially the same
terms and conditions, in any transfer by any significant holders of 20% or more
of our voting stock. Based on their current holdings of our capital stock,
each of MatlinPatterson, Inland/Links and R<SUP>2</SUP> Investments could exercise this
tag-along right.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Amendments to bylaws and charter. </I>As a result of changes to our bylaws we
adopted in connection with the restructuring, our significant holders,
currently MatlinPatterson and Inland/Links, together will have the power to
designate, either directly or through a committee including members of our
board of directors that they have previously designated, an aggregate of six
nominees for election to our board of directors (at least four of whom must
qualify as independent directors under applicable exchange rules and listing
standards) and two board observers.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We also agreed in connection with the restructuring to propose a number of
changes to our certificate of incorporation for adoption by our stockholders.
These changes will benefit holders of a significant amount of our capital
stock, including MatlinPatterson, Inland/Links and R<SUP>2</SUP> Investments. See
&#147;Proposals 3 through 12&#151;Charter Amendments.&#148;
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Transactions involving executive officers. </I>We also entered into
employment agreements with and granted stock options to four executive officers
in connection with the restructuring. See &#147;Executive
Compensation&#151;Employment
Agreements.&#148;
</FONT>
<P align="left"><FONT size="2"><B>Section&nbsp;16(A) Beneficial Ownership Reporting Compliance</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;16(a) of the Securities Exchange Act of 1934 requires our
directors and executive officers, and persons who own more than 10% of a
registered class of our equity securities, to file with the Securities and
Exchange Commission initial reports of ownership and reports of changes in
ownership of our equity securities. Executive officers, directors and greater
than 10% stockholders are required by Commission regulations to furnish us with
copies of all Section&nbsp;16(a) forms they file. To our knowledge, based solely on
a review of the copies of such reports furnished to us during and for the
fiscal year ended December&nbsp;29, 2002, our executive officers and directors and
any greater than 10% beneficial owners complied with all applicable Section
16(a) filing requirements.
</FONT>
<P align="center"><FONT size="2">12</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>EXECUTIVE COMPENSATION</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth compensation information for fiscal years
2002, 2001 and 2000 for those persons who were, except as otherwise noted, our
Chief Executive Officer and our four other most highly paid executive officers
as of December&nbsp;29, 2002:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="46%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Long Term</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Compensation</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Awards</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="7"><FONT size="1"><B>Annual Compensation</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Securities</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="7"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Other Annual</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Underlying</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>All Other</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><FONT size="1"><B>Name and Principal Position</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Salary</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Bonus</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Compensation</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Options(#)(1)</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Compensation</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Larry L. Enterline (2)</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2002</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">409,476</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD nowrap><FONT size="2">(3)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">

<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;&nbsp;Chief Executive Officer</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2001</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">414,666</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD nowrap><FONT size="2">(3)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">4,404</FONT></TD>
    <TD nowrap><FONT size="2">(4)</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">5,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">700,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">James C. Hunt</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2002</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">307,445</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">147,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">50,000</FONT></TD>
    <TD nowrap><FONT size="2">(5)</FONT></TD>
</TR>

<TR valign="bottom">

<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;&nbsp;President and Chief Financial Officer</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2001</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">307,965</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">200,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">50,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">131,216</FONT></TD>
    <TD nowrap><FONT size="2">(6)</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">308,100</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">40,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">50,000</FONT></TD>
    <TD nowrap><FONT size="2">(7)</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Michael H. Barker</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2002</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">246,741</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">84,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">2,750</FONT></TD>
    <TD nowrap><FONT size="2">(5)</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;&nbsp;President &#151; Division Operations</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2001</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">247,379</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">108,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">40,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">67,759</FONT></TD>
    <TD nowrap><FONT size="2">(6)</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">247,870</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">40,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">16,236</FONT></TD>
    <TD nowrap><FONT size="2">(7)</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Ken R. Bramlett, Jr.</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2002</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">247,175</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">84,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">20,160</FONT></TD>
    <TD nowrap><FONT size="2">(5)</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;&nbsp;Senior Vice President, General Counsel and</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2001</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">247,695</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">96,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">30,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">102,013</FONT></TD>
    <TD nowrap><FONT size="2">(6)</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;&nbsp;Secretary</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">248,100</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">40,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">50,000</FONT></TD>
    <TD nowrap><FONT size="2">(7)</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Thomas M. Wittenschlaeger (8)</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2002</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">205,441</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">70,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">16,215</FONT></TD>
    <TD nowrap><FONT size="2">(5)</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;&nbsp;Senior Vice President, Corporate</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2001</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">165,336</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">69,750</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">50,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">27,376</FONT></TD>
    <TD nowrap><FONT size="2">(9)</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;&nbsp;Development and Chief Technology Officer</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P>
<HR size="1" width="18%" align="left" noshade>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(1)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Option grants for the named officers in 2000 and 2001 generally vested
25% on each of the first four anniversaries of the grant dates. In
connection with the Company&#146;s recently completed financial restructuring,
each of the named executives has irrevocably waived his right to exercise
all of his outstanding options for the Company&#146;s common stock granted
under the 1995 Stock Option Plan, including these options, and has
forfeited all of such options to the Company. The Company did not grant
stock options to any of the named officers in 2002.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(2)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Mr.&nbsp;Enterline was appointed as our Chief Executive Officer in December
2000.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(3)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">At the request of the Compensation Committee, Mr.&nbsp;Enterline has deferred
the payment of his bonuses for 2001 and 2002. Mr.&nbsp;Enterline&#146;s bonus for
2001 was a guaranteed $400,000, and his bonus for 2002 was $280,000.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(4)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Represents relocation expense reimbursements paid to Mr.&nbsp;Enterline in
2001.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(5)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Represents 2002 allocations to our non-qualified profit-sharing plan for
Mr.&nbsp;Hunt, Mr.&nbsp;Bramlett and Mr.&nbsp;Wittenschlaeger and a matching contribution
to our IT Services Division 401(k) plan for Mr.&nbsp;Barker.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(6)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Represents 2001 allocations to our non-qualified profit-sharing plan for
Mr.&nbsp;Hunt, Mr.&nbsp;Barker and Mr.&nbsp;Bramlett of $50,000, $17,964 and $19,903,
respectively, and $81,216, $49,795 and $82,110, respectively, paid to the
named officers in connection with the termination and amendment of
vacation and paid time off plans.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(7)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Represents 2000 allocations to our non-qualified profit-sharing plan for
the named officers.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(8)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Mr.&nbsp;Wittenschlaeger served as our Senior Vice President, Corporate
Development and Chief Technical Officer from April 2001 until his
resignation in January 2003.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(9)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Represents a 2001 allocation to our non-qualified profit-sharing plan for
Mr.&nbsp;Wittenschlaeger of $10,020 and $17,356 of relocation expense
reimbursements.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">13</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Option Year-End Value Table</I>.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth certain information concerning unexercised
options held as of the end of 2002. None of the named officers exercised any
options during 2002.
</FONT>
<P align="center"><FONT size="2"><B>Fiscal Year-End Option Value</B></FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="90%">
<TR valign="bottom">
    <TD width="50%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="7"><FONT size="1"><B>Number of Securities Underlying</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="7"><FONT size="1"><B>Value of Unexercised In-the-Money</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="7"><FONT size="1"><B>Unexercised Options at FY-End (#)(1)</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="7"><FONT size="1"><B>Options at FY-End ($)(2)</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="7"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="7"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><FONT size="1"><B>Name</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Exercisable</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Unexercisable</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Exercisable</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Unexercisable</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Larry L. Enterline</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">350,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">350,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">James C. Hunt</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">296,248</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">71,574</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Ken R. Bramlett, Jr.</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">177,771</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">52,199</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Michael H. Barker</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">103,471</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">54,375</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Thomas M. Wittenschlaeger</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">12,500</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">37,500</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P>
<HR size="1" width="18%" align="left" noshade>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(1)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">In connection with the Company&#146;s recently completed financial
restructuring, each of the named officers has irrevocably waived his
rights to exercise all of these options and forfeited them to the Company.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(2)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">The fair market value of the common stock used for these computations was
$0.14, which was the last bid price for our common stock on the OTC
Bulletin Board on December&nbsp;27, 2002.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2"><B>Employment Agreements</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following six paragraphs describe the employment agreements with our
executive officers that were in effect until the completion of our financial
restructuring in April 2003, or in the case of Mr.&nbsp;Wittenschlaeger, until his
resignation as an executive officer in January 2003.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Larry L. Enterline was employed pursuant to a letter agreement dated
December&nbsp;20, 2000. The letter agreement provided for (i)&nbsp;an annual base salary
of $400,000 (subject to annual adjustment as determined by the Compensation
Committee), and (ii)&nbsp;the right to earn bonuses under the Company&#146;s Management
Incentive Compensation Plan. The letter agreement also provided for a minimum
annual bonus for 2001 of $400,000, but the Compensation Committee notified Mr.
Enterline in December 2001 that it had elected to defer the payment of his 2001
bonus until January 2003. The letter agreement did not specify a term of
employment for Mr.&nbsp;Enterline. However, it did provide that if Mr.&nbsp;Enterline&#146;s
employment were terminated within the first two years by the Company other than
for cause or by Mr.&nbsp;Enterline following a change in control of the Company, the
Company would pay Mr.&nbsp;Enterline severance equal to 12&nbsp;months&#146; salary and any
unpaid bonus to which he would otherwise have been entitled, and all unvested
options to purchase Common Stock then held by Mr.&nbsp;Enterline would become
immediately exercisable.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;James C. Hunt was employed pursuant to the terms of an employment
agreement, dated as of January&nbsp;2, 1997, that provided for his employment until
December&nbsp;31, 2002, subject to automatic renewal for successive one-year periods
unless either the Company or Mr.&nbsp;Hunt gave notice of non-renewal six months
prior to expiration. Neither the Company nor Mr.&nbsp;Hunt gave notice of
non-renewal prior to June&nbsp;30, 2002. The employment agreement provided for (i)
an annual base salary of $300,000 (subject to annual adjustment as determined
by the Compensation Committee) and (ii)&nbsp;the right to earn bonuses under the
Company&#146;s Management Incentive Compensation Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Michael H. Barker was employed pursuant to the terms of an employment
agreement, dated as of January&nbsp;19, 1998, that provided for his employment until
January&nbsp;18, 2003, subject to automatic renewal for
</FONT>
<P align="center"><FONT size="2">14</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">successive one-year periods unless either the Company or Mr.&nbsp;Barker gave
notice of non-renewal six months prior to expiration. Neither the Company nor
Mr.&nbsp;Barker gave notice of non-renewal prior to July&nbsp;18, 2002. The employment
agreement provided for (i)&nbsp;an annual base salary of $240,000 (subject to annual
adjustment as determined by the Compensation Committee) and (ii)&nbsp;the right to
earn bonuses under the Company&#146;s Management Incentive Compensation Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ken R. Bramlett, Jr. was employed pursuant to the terms of an employment
agreement, dated as of October&nbsp;7, 1996, that provided for his employment until
September&nbsp;30, 2002, subject to automatic renewal for successive one-year
periods unless either the Company or Mr.&nbsp;Bramlett gave notice of non-renewal
six months prior to expiration. Neither the Company nor Mr.&nbsp;Bramlett gave
notice of non-renewal prior to March&nbsp;31, 2002. The employment agreement
provided for (i)&nbsp;an annual base salary of $240,000 (subject to annual
adjustment as determined by the Compensation Committee) and (ii)&nbsp;the right to
earn bonuses under the Company&#146;s Management Incentive Compensation Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Thomas M. Wittenschlaeger was employed pursuant to the terms of an
employment agreement, dated as of April&nbsp;11, 2001, that provided for his
employment until April&nbsp;11, 2003, subject to automatic renewal for successive
one-year periods unless either the Company or Mr.&nbsp;Wittenschlaeger gave notice
of non-renewal six months prior to expiration. The employment agreement
provided for (i)&nbsp;an annual base salary of $200,000 (subject to annual
adjustment as determined by our Compensation Committee) and (ii)&nbsp;the right to
earn bonuses under the Company&#146;s Management Incentive Compensation Plan. In
accordance with the terms of Mr.&nbsp;Wittenschlaeger&#146;s separation arrangement, the
Company will pay him severance equal to one year&#146;s base salary.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of these employment agreements for Mr.&nbsp;Hunt, Mr.&nbsp;Barker, Mr.&nbsp;Bramlett
and Mr.&nbsp;Wittenschlaeger also provided that if the employment agreement were
terminated by the Company other than for cause, or by the executive upon a
change in terms and conditions of employment or following a change in control
of the Company, the Company would pay the executive severance equal to 12
months&#146; salary (24&nbsp;months&#146; salary, in the case of Mr.&nbsp;Hunt) and any unpaid
bonus to which he would otherwise have been entitled, and all unvested options
to purchase Common Stock then held by the executive would become immediately
exercisable. Each employment agreement also contained a provision prohibiting
the executive from competing with the Company or soliciting employees and
customers of the Company for a period of two years from the date his employment
with the Company ceased.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of Mr.&nbsp;Enterline, Mr.&nbsp;Hunt, Mr.&nbsp;Barker and Mr.&nbsp;Bramlett is now
employed pursuant to an employment agreement dated as of the closing date of
our financial restructuring. Each employment agreement provides for an annual
base salary, the right to earn annual bonuses as described below and, in the
event that our stockholders approve our new incentive plan at this annual
meeting, the right to participate in such new plan. The initial annual base
salaries established in these agreements for Mr.&nbsp;Enterline, Mr.&nbsp;Hunt, Mr.
Barker and Mr.&nbsp;Bramlett are $400,000, $300,000, $240,000 and $240,000,
respectively. Each employment agreement is for an initial term of two years,
with automatic one-year extensions thereafter unless either party provides
written notice of termination at least three months prior to any scheduled
expiration date.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each annual bonus under these employment agreements will have both an
objective component and a subjective component: 70% of the bonus will be tied
to achievement of at least 90% of a targeted EBITDA figure for the year, with
the executive eligible to earn the maximum portion of this component of the
bonus if we achieve 140% of the targeted EBITDA figure. The remaining 30% of
the bonus will be subject to the discretion of our Compensation Committee. The
targeted EBITDA bonus awards for each executive officer will be determined as a
percentage of the executive&#146;s base salary, as follows:
</FONT>
<P align="center"><FONT size="2">15</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="55%">
<TR valign="bottom">
    <TD width="71%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Bonus at Targeted</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Maximum</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><FONT size="1"><B>Executive</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>EBITDA(1)</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Bonus(1)</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Larry L. Enterline</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">30</FONT></TD>
    <TD nowrap><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">100</FONT></TD>
    <TD nowrap><FONT size="2">%</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">James C. Hunt</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">30</FONT></TD>
    <TD nowrap><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">90</FONT></TD>
    <TD nowrap><FONT size="2">%</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Michael H. Barker</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">30</FONT></TD>
    <TD nowrap><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">90</FONT></TD>
    <TD nowrap><FONT size="2">%</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Ken R. Bramlett, Jr.</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">30</FONT></TD>
    <TD nowrap><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">60</FONT></TD>
    <TD nowrap><FONT size="2">%</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P>
<HR size="1" width="18%" align="left" noshade>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(1)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Percentage of base salary. The Bonus at Targeted EBITDA
column is based upon achievement of 100% of the targeted EBITDA
number, while the Maximum Bonus column is based upon achievement of
140% of the targeted EBITDA number. Both columns are based upon
full award of the 30% of bonus that is subject to the Compensation
Committee&#146;s discretion.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In connection with our recently completed financial restructuring, each of
the named officers has irrevocably waived all of his rights to exercise his
outstanding stock options granted under our 1995 Stock Option Plan and
forfeited all of such options to the Company. For the number of options
forfeited by each of these executives, see the table labeled &#147;Fiscal Year-End
Option Value&#148; above. Each of these officers has also been awarded an initial
grant of stock options under our new 2003 Equity Incentive Plan, subject to
stockholder approval of the new plan at this annual meeting. Those initial
stock option awards under the new plan were for 5,750,000 shares to Mr.
Enterline, 2,985,000 shares to Mr.&nbsp;Hunt, 2,250,000 shares to Mr.&nbsp;Barker and
1,600,000 shares to Mr.&nbsp;Bramlett, and all have exercise prices higher than the
per share trading price of our common stock on the date of the award.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The employment agreements for each of Mr.&nbsp;Enterline, Mr.&nbsp;Hunt, Mr.&nbsp;Barker
and Mr.&nbsp;Bramlett provide that options granted under the new incentive plan to
these executive officers will vest monthly on a pro rata basis over 4&nbsp;years.
If any of these executive officers is terminated without cause prior to the
first anniversary of the date of his employment agreement, 25% of the options
initially granted to him will vest automatically as of the date of termination.
In addition, all of these options will vest automatically in the event of a
change of control involving the Company. Following a termination of
employment, each executive will have three months to exercise his vested stock
options unless his termination was without cause, in which event the exercise
period will be extended to 12&nbsp;months.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The employment agreements for Mr.&nbsp;Enterline, Mr.&nbsp;Hunt, Mr.&nbsp;Barker and Mr.
Bramlett also provide these executive officers with one year of severance upon
termination (including any non-renewal) without cause. Mr.&nbsp;Hunt&#146;s employment
agreement provides him with two years of severance upon termination (including
any non-renewal) without cause. Each of the four employment agreements
requires the executive to agree to customary non-compete and non-solicitation
provisions.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The employment agreements for Mr.&nbsp;Enterline and Mr.&nbsp;Bramlett also provide
them with additional severance benefits if there is a change of control
involving the Company in the first year of their agreements&#146; term (i.e., before
April 2004). The severance benefits for each of Mr.&nbsp;Enterline and Mr.&nbsp;Bramlett
will be extended to two years from one year if a change of control occurs
during this first year and either the executive terminates the employment
agreement for good reason or the Company terminates it without cause within six
months after the change of control. However, if the sale price per share of
our capital stock in such change of control transaction represents a total
equity value of more than $100&nbsp;million, each of these officer&#146;s additional
severance will be reduced, dollar for dollar, if and to the extent that the sum
of any stock option gains realized by the officer in such change of control
transaction, plus the additional severance, exceeds the sum of the officer&#146;s
additional severance plus his realized stock option gains in a change of
control transaction with a total equity value equal to $100&nbsp;million.
</FONT>
<P align="center"><FONT size="2">16</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION</B></FONT>

<P align="left"><FONT size="2"><B>General</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It is the Compensation Committee&#146;s responsibility to review and recommend
to the board for approval the compensation plans for our senior officers. The
goals of our compensation programs for senior officers are to set compensation
based on the attainment of performance objectives, to establish compensation
levels that will enable us to attract and retain talented individuals and to
motivate them to achieve our business objectives. To achieve these goals, we
have established a compensation program consisting of three principal
components. These components are base salary, incentive bonus awards made
under the Management Incentive Compensation Plan and discretionary bonuses in
the form of equity-based compensation consisting primarily of qualified (or
incentive) and non-qualified stock options. We strive to structure our
compensation programs to enable us to attract, retain and reward qualified
senior management whose contributions are critical to our long-term success.
</FONT>
<P align="left"><FONT size="2"><B>Base Salary</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We consider the sustained performance of our senior officers in
establishing base salaries. Among the factors considered are length of
service, individual performance, scope of responsibilities and successful
management of administrative or financial functions or operating subsidiaries
or divisions. The assessment of management performance focuses on both
qualitative factors (such as leadership and management qualities) and
quantitative factors (such as growth of revenues, operating earnings, cash
flow, earnings per share, the containment of expenses and debt reduction).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Chief Executive Officer historically has evaluated the overall
performance of our senior officers, including those other officers named in the
Summary Compensation Table, and made recommendations for base salary
adjustments to the Compensation Committee. Financial and business goals and
objectives are typically discussed with key executives, and periodic meetings
of key executives are held to discuss business strategies, financial and
business performance, budgeting matters and strategic planning matters. An
executive&#146;s overall evaluation is a combination of a qualitative review by
fellow executives and the Chief Executive Officer and a review of the extent to
which pre-established business and financial objectives have been obtained.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In 2002, we continued the salary freeze implemented for senior management
employees in the year 2000 and, as a result, the Compensation Committee
approved no 2002 base salary increases for any of the officers named in the
Summary Compensation Table. As of the date of this proxy statement, this
salary freeze is still in effect.
</FONT>
<P align="left"><FONT size="2"><B>Incentive Bonus Awards</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Despite the difficult economic environment in 2002 and its adverse impact
on our financial results, the market remains very competitive for talented
people and the Compensation Committee assessed these conditions in 2002 in an
effort to design incentive bonus awards that would motivate and retain the
talented management personnel needed to lead the Company and keep our employees
engaged and motivated. Early in the fiscal year, the Compensation Committee
established a range of incentive bonus compensation that could be earned as
part of each senior officer&#146;s annual compensation. For the year, 50% of the
potential incentive bonus compensation for Mr.&nbsp;Enterline, Mr.&nbsp;Hunt, Mr.
Bramlett, Mr.&nbsp;Barker and Mr.&nbsp;Wittenschlaeger was based on our achievement of
pre-established annual debt reduction and earnings before interest, taxes,
depreciation and amortization goals and 50% was based on a qualitative
assessment of performance against specific objectives as determined by the
Compensation Committee. The Committee believed that the use of objective debt
reduction and EBITDA targets in determining incentive bonus
</FONT>
<P align="center"><FONT size="2">17</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">compensation for these individuals was an appropriate way to focus management&#146;s
efforts in 2002 on the rapid repayment of outstanding debt and to directly
align the interests of our executive officers and stockholders. The Committee
also considered it appropriate to allow qualitative factors to determine a
significant portion of the executive officers&#146; bonus opportunity, given the
weak economic environment generally in which we have operated over the past
years, the fact that none of the named officers had received salary increases
since 1999, the fact that no bonuses were paid to the named officers for 2000
and the lack of any formal retention policies for such officers. Additionally,
the Committee believed that incentivizing management to improve underlying
processes and practices and focus on gaining efficiencies was important during
this period of weak macroeconomic conditions.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company&#146;s debt and net debt at the end of 2002 were well below the
debt targets, but EBITDA during 2002 did not meet the EBITDA target. Because
the Compensation Committee determined that assigning weight to the qualitative
bonus factors for 2002 was inappropriate given the economic environment and the
financial performance of the Company generally during the year, bonuses were
awarded to the named officers for their performance in 2002 in the amounts
reflected in the compensation table based solely on the objective debt
reduction achieved during the year. Mr.&nbsp;Enterline&#146;s bonus award based on the
achievement of the debt reduction target in 2002 was $280,000. As in 2001, the
Compensation Committee requested that Mr.&nbsp;Enterline defer payment of this bonus
until a later date.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In 1997, the Compensation Committee implemented a program designed to
encourage designated senior officers to take portions of their annual incentive
bonuses in the form of stock options. Under this program, each designated
officer may elect, prior to the end of each fiscal year, to receive a set
percentage (up to 50%) of his bonus for that year in the form of stock options
granted under our 1995 Stock Option Plan, the number of options being granted
in each case to be determined by a formula set by the Committee. The
Compensation Committee established this program for two main reasons (in
addition to the other factors considered below in the granting of stock options
generally). First, distributing stock options to selected senior officers in
lieu of cash bonuses enables us to conserve cash for investment. Second,
paying bonuses in stock options is consistent with one of the Compensation
Committee&#146;s stated goals of increasing the equity portion of senior officer
compensation and Company equity holdings by the senior officers generally.
None of our executive officers participated in this program for fiscal 2002.
</FONT>
<P align="left"><FONT size="2"><B>Discretionary Bonus Awards/Equity Based Compensation</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;One of the Compensation Committee&#146;s stated goals as discussed above is to
increase the equity portion of senior officers&#146; compensation generally.
Accordingly, we also reward our senior officers with discretionary compensation
awards, generally in the form of incentive stock options and non-qualified
stock options granted under our 1995 Stock Option Plan. Through the granting
of stock options, we seek to align the interests of key employees more closely
with those of our stockholders by motivating and rewarding actions that lead to
long-term value creation for stockholders. In addition, we recognize that
stock options are a necessary part of a competitive compensation program,
which, as discussed above, is designed to attract and retain qualified
executives. Historically, options granted to senior officers (other than
options granted in lieu of cash bonuses) have vested over a four-year period in
order to encourage executives and other key employees to remain in our employ
and to foster a long-term perspective.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In fiscal 2002, we did not grant any stock options to the executive
officers named in the compensation table. Moreover, in connection with the
Company&#146;s financial restructuring, each of these executive officers has
irrevocably waived his right to exercise the options he has previously been
granted under the 1995 Stock Option Plan and forfeited all of such stock
options to the Company. The Company has terminated the 1995 Stock Option Plan
and intends, subject to stockholder approval, to implement a new incentive plan
in which these officers will participate. For a description of the new
incentive plan and the initial grants made thereunder, see &#147;Proposal 2 &#151; Equity
Incentive Plan.&#148;
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">18</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="left"><FONT size="2"><B>Chief Executive Officer&#146;s Compensation</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Larry L. Enterline has served as our Chief Executive Officer since
December 2000, and his 2002 compensation was determined pursuant to the terms
of his employment agreement with us at the time. See &#147;Executive
Compensation&#151;Employment Agreements.&#148; The agreement provided for the payment
of a base salary to Mr.&nbsp;Enterline of $400,000 in 2002 and also provided that
Mr.&nbsp;Enterline would be eligible for incentive bonuses under the Company&#146;s
Management Incentive Compensation Plan. Mr.&nbsp;Enterline&#146;s incentive for 2002 was
identical to those of the other executive officers of the Company in terms of
the criteria and methods for calculating bonus payouts, but as the Chief
Executive Officer of our Company his targeted payouts for each of the
applicable criteria placed him in our highest tier of executive compensation.
Like the other executives in 2002, the objective portion of Mr.&nbsp;Enterline&#146;s
bonus of $280,000 was based solely on our achieving the debt reduction targets
established at the beginning of 2002. Because we did not meet our EBITDA
target for the year, no bonus was awarded to any executive officer, including
Mr.&nbsp;Enterline, for that criterion.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Compensation Committee also assessed Mr.&nbsp;Enterline&#146;s performance
during 2002 qualitatively against a number of specific objectives that the
Committee had established with Mr.&nbsp;Enterline earlier in the year. Although the
Committee believes that Mr.&nbsp;Enterline performed satisfactorily against these
objectives during 2002, the Committee determined that it was inappropriate to
award bonuses to any of the executive officers, including Mr.&nbsp;Enterline, based
on these qualitative factors given the economic environment and the Company&#146;s
financial performance generally during the year.
</FONT>
<P align="left"><FONT size="2"><B>Section&nbsp;162(m) of the Internal Revenue Code</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It is our policy generally to design compensation programs to comply with
Section&nbsp;162(m) of the Internal Revenue Code, so that total compensation paid to
any employee will not exceed $1.0&nbsp;million in any one year, except for
compensation payments in excess of $1.0&nbsp;million that qualify as
&#147;performance-based.&#148; We intend to comply with other requirements of the
performance-based compensation exclusion under Section&nbsp;162(m), including option
pricing requirements and requirements governing the administration of the 1995
Stock Option Plan and, if it is approved, our 2003 Equity Incentive Plan, and
we therefore do not expect the deductibility of compensation paid to top
executives to be disallowed.
</FONT>
<P align="right"><FONT size="2">2002 Compensation Committee:
</FONT>
<P align="right"><FONT size="2">J. Roger King, Chairman<BR>
Kevin P. Egan<BR>
James V. Napier
</FONT>
<P align="center"><FONT size="2">19</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>CORPORATE PERFORMANCE GRAPH</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following graph compares the cumulative total return on our common
stock for the five fiscal years ended December&nbsp;29, 2002 with the cumulative
total return of the S&#038;P 400 Index and a peer group index we selected. The peer
group consists of seven public companies that, except as noted below,
specialize in providing personnel staffing services in the United States. All
cumulative returns assume the investment of $100 in each of our common stock,
the S&#038;P 400 Index, and the peer group index on December&nbsp;29, 1997, the first day
of fiscal 1998, and assume the reinvestment of dividends.
</FONT>
<P align="center"><FONT size="2"><IMG src="g82690p1g8269002.gif" alt="(PERFORMANCE GRAPH)">
</FONT>

<DIV align="center">
<TABLE cellspacing="0" border="0" cellpadding="0" width="85%">
<TR valign="bottom">
    <TD width="46%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="23"><HR size="1" noshade></TD>
</TR>

<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>12/97</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>12/98</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>12/99</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>12/00</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>12/01</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>12/02</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="23"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">PERSONNEL GROUP OF AMERICA, INC.</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">100.00</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">106.06</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">62.12</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">10.23</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">5.39</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.88</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">S &#038; P MIDCAP 400</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">100.00</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">119.12</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">136.65</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">160.57</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">159.60</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">136.44</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">

<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">PEER GROUP*</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">100.00</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">85.61</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">78.67</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">82.01</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">80.38</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">59.09</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</DIV>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*The peer group index consists of the following companies: Spherion
Corp., MPS Group,, Inc., Barrett Business Services Inc., Robert Half
International Inc., Kelly Services, Inc., Manpower, Inc. and Edgewater
Technologies, Inc. (Edgewater&#146;s business now focuses on technical consulting,
software development and systems integration).
</FONT>
<P align="center"><FONT size="2">20</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>SECURITY OWNERSHIP OF CERTAIN<BR>
BENEFICIAL OWNERS AND MANAGEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth, as of April&nbsp;22, 2003 (except where
otherwise noted), the number and percentage of outstanding shares beneficially
owned by each person known by us to own beneficially more than 5% of our common
stock or Series&nbsp;B preferred stock, by each of our directors, by our Chief
Executive Officer, by all of our executive officers (including the four other
most highly paid executive officers for 2002) and by all of our directors and
executive officers as a group. Except as otherwise set forth below, each
stockholder named has sole voting and investment power with respect to his or
her or its shares.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="54%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="7"><FONT size="1"><B>Shares Beneficially Owned</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="7"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Percent of</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="7"><FONT size="1"><B>Common Stock (1)(2)</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="7"><FONT size="1"><B>Series B Preferred Stock</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Total</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="7"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="7"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Voting</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><FONT size="1"><B>Name and Address* of Beneficial Owner</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Percent</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Percent</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Power</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">MatlinPatterson Global Opportunities Partners
L.P. and MatlinPatterson Global Opportunities
Partners (Bermuda) L.P.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
19,730,493</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(3)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">35.2</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">576,567</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(3)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">55.2</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">45.4</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;520 Madison Avenue</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;New York, New York 10022</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;and</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Links Partners, L.P. and Inland Partners, L.P.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;61 Wilton Avenue, 2nd Floor</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;Westport, Connecticut 06880</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Amalgamated Gadget, L.P.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
4,883,245</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(4)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">10.2</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">182,560</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(4)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">17.5</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">14.4</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;City Center Tower II</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;301 Commerce Street, Suite&nbsp;2975</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;Fort Worth, Texas 76102</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">National Union Fire Insurance Company of
Pittsburgh, P.A.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
1,696,644</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(5)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">3.5</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">84,623</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(5)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">8.1</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">6.7</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;c/o Zazove Associates</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;940 Southwood Boulevard, Suite&nbsp;200</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;&nbsp;Incline Village, NV 89451</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Larry L. Enterline</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
219,792</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">James C. Hunt</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
84,898</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(6)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Michael H. Barker</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
78,352</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Ken R. Bramlett, Jr.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
47,423</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(7)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Thomas E. Stafford</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
1,938</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Victor E. Mandel</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">James V. Napier</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
45,000</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Christopher R. Pechock</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Elias J. Sabo</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
19,730,493</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(3)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">35.2</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">576,567</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">(3)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">55.2</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">45.4</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">William J. Simione, Jr.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
8,000</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Janice L. Scites</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
11,000</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">&#151;</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">**</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">All directors and executive officers as a group
(11 persons)</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">
20,226,896</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">36.1</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">576,567</FONT></TD>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">55.2</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2">45.6</FONT></TD>
    <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P>
<HR size="1" width="18%" align="left" noshade>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">*</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Addresses are furnished only for beneficial owners of more than 5% of our
common stock or Series&nbsp;B preferred stock.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">**</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Less than one percent</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(1)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">These numbers do not include outstanding shares of our Series&nbsp;B preferred
stock, which are convertible into our common stock, because the preferred
holders&#146; right to convert the Series&nbsp;B preferred stock is conditioned on
our amending our certificate of incorporation to increase the number of
authorized shares of our common stock or to effect a reverse split of
outstanding shares of common stock. We may not be able to effect this
amendment within 60&nbsp;days after April&nbsp;22, 2003.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">21</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>





<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(2)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">These numbers includes the following shares subject to stock options
exercisable 60&nbsp;days after April&nbsp;22, 2003: Mr.&nbsp;Enterline &#151; 119,792; Mr.
Hunt &#151; 62,188; Mr.&nbsp;Barker &#151; 46,875; and Mr.&nbsp;Bramlett &#151; 33,333.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(3)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">The amount and nature of the shares beneficially owned are as of April
16, 2003, and are based on the most recent Schedule&nbsp;13D amendment on file
with us and on information the reporting persons have provided to us.
This amendment was filed by MatlinPatterson Global Opportunities Partners
L.P., MatlinPatterson Global Opportunities Partners (Bermuda) L.P.,
MatlinPatterson Global Opportunities Partners B, L.P., Links Partners,
L.P., Inland Partners, L.P., Matlin Patterson Global Advisers LLC,
MatlinPatterson Global Partners LLC, MatlinPatterson Asset Management LLC,
MatlinPatterson LLC, Coryton Management Ltd., Mark. R. Patterson, David J.
Matlin, Arthur Coady, Elias Sabo and I. Joseph Massoud, and the parties
have reported to us shared voting and dispositive powers with respect to
all shares reported. The number of shares of common stock shown in the
table includes 8,170,589 shares subject to warrants that are currently
exercisable. According to this amendment, as well as the most recent
Schedule&nbsp;13D of Amalgamated Gadget on file with us (as described in Note 4
below), warrants for approximately 4,085,294 of these shares are subject
to a pending sale to R<SUP>2</SUP> Investments, LDC, on whose behalf Amalgamated
Gadget has acquired our capital stock.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(4)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">The amount and nature of the shares beneficially owned are as of April
22, 2003, and are based on the most recent Schedule&nbsp;13D (or amendment
thereto) on file with us. According to this Schedule&nbsp;13D, as well as the
most recent Schedule&nbsp;13D of MatlinPatterson Global Opportunities Partners
L.P. et al. on file with us (as described in Note 3 above), R<SUP>2</SUP>
Investments, LDC, on whose behalf Amalgamated Gadget has acquired our
capital stock, is in the process of purchasing warrants for approximately
4,085,294 shares of common stock from MatlinPatterson Global Opportunities
Partners L.P. et al. The number of shares of common stock shown in the
table does not include these shares.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(5)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">The amount and nature of the shares beneficially owned are as of April
14, 2003, and are based on information provided to us in connection with
our financial restructuring.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(6)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">This number includes 1,120 shares held in the names of Mr.&nbsp;Hunt&#146;s spouse
and children.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(7)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">This number includes 500 shares held in the name of Mr.&nbsp;Bramlett&#146;s
spouse.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">22</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>


<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>PROPOSAL 2 </B>&#151; <B>EQUITY INCENTIVE PLAN</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our board of directors believes that our future growth and success will
depend, in large part, upon our ability to attract, motivate and retain
competitively superior key employees and consultants and highly qualified
directors. Our board of directors also believes that stock option and other
equity incentive grants have been, and will continue to be, an important
element in achieving this goal by furthering an alignment of the participants&#146;
interests with those of our stockholders, thereby promoting our long-term
growth and profitability. Accordingly, our board of directors has unanimously
adopted, subject to stockholder approval of this proposal, the 2003 Equity
Incentive Plan of Personnel Group of America, Inc., which we refer to as the
new incentive plan. The purpose of the new incentive plan is to advance the
interests of the Company by encouraging and enabling the acquisition of a
larger proprietary interest by our employees, directors and consultants, and by
providing these persons with incentives to put forth maximum efforts for the
success of our business.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following summary of the new incentive plan is qualified in its
entirety by reference to the text of the plan, a copy of which is attached as
Annex C to this proxy statement.
</FONT>
<P align="left"><FONT size="2"><B>Types of Awards; Shares Available</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The new incentive plan authorizes grants of stock options, stock
appreciation rights (or SARS), restricted stock, deferred stock awards and
performance awards (and dividend equivalent rights relating to options, SARs,
deferred stock and performance awards), in the case of stock or option awards,
for up to 10.34% of the fully diluted shares of our common stock, or 19,870,873
shares. The new incentive plan includes customary anti-dilution provisions.
</FONT>
<P align="left"><FONT size="2"><B>Term</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Awards under the new incentive plan may be made through April&nbsp;13, 2013, so
long as, in the case of stock-based awards, authorized shares are available for
issuance. All plan awards made prior to the annual meeting are contingent on
stockholder approval of the new incentive plan.
</FONT>
<P align="left"><FONT size="2"><B>Administration and Participants</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A committee of two or more non-employee directors, which initially will be
the Compensation Committee of the board, will administer the new incentive
plan. The Committee will have full discretionary authority in interpreting the
terms of the new incentive plan and of individual award agreements under the
new incentive plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Grants under the new incentive plan may be made to key employees,
directors and consultants of the Company or any of its subsidiaries, as
selected by the Compensation Committee. As of the date of this proxy
statement, approximately 75 key employees (including five executive officers)
and our six non-employee directors are eligible for grants under the plan. The
Compensation Committee will also determine the actual share numbers and other
amounts and exercise/purchase prices for all grants under the new incentive
plan, except that the number of shares of our common stock that are subject to
grants of options and SARs to any single individual during a calendar year may
not exceed 5,750,000.
</FONT>
<P align="left"><FONT size="2"><B>Awards</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Compensation Committee may in its discretion require consideration for
the grant of awards under the new incentive plan.
</FONT>
<P align="center"><FONT size="2">23</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Stock options. </I>Options awarded under the new incentive plan may be
incentive stock options (intended to qualify as such under Section&nbsp;422 of the
Internal Revenue Code) or non-qualified options, or a combination of both, as
determined by the Compensation Committee. The Compensation Committee will also
determine the exercise price for all options granted under the new incentive
plan, except that the exercise price for incentive stock options must be at
least equal to the fair market value of our common stock on the date of grant.
The fair market value of our common stock on June ___, 2003, based on its
closing bid price on the OTC Bulletin Board, was $__.____.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Options awarded under the new incentive plan may be exercised by delivery
of cash, check or shares of our common stock held by the option holder for at
least six months, or by any other methods permitted by the Compensation
Committee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>SARs. </I>SARs awarded under the new incentive plan may be granted in
connection with options granted under the plan, or they may be unrelated. Each
SAR related to an option entitles the holder to receive payment only when the
related option is exercised, and as an alternative to exercising the option.
Upon exercise of the SAR and related option, the holder is generally entitled
to receive an amount equal to the fair market value of a share of our common
stock on the date of exercise, less the exercise price of the related option.
Each SAR that is unrelated to an option may be exercised during the period of
time set by the Compensation Committee. Upon exercise of each unrelated SAR,
the holder is generally entitled to receive an amount equal to the fair market
value of a share of our common stock on the date of exercise, less the fair
market value of a share of our common stock on the date the SAR was granted.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In each case, the Company may make payment to the holder in cash, shares
of our common stock, or a combination of both.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Restricted stock awards. </I>Shares of common stock awarded as restricted
stock under the new incentive plan will be subject to transfer restrictions and
risk of forfeiture, as the Compensation Committee determines at the time of
grant, until specified conditions are met. These conditions may be based on
continuing employment, achievement of pre-established performance objectives,
or both. Until the restrictions set by the Compensation Committee lapse or are
satisfied, the restricted stock may not be transferred by any means.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company will retain possession of the certificates representing shares
of restricted stock with respect to which the restrictions have not lapsed or
been satisfied. Notwithstanding retention of the certificates by the Company,
the participant in whose name any certificate is issued will have all rights of
a stockholder of the Company, including dividend and voting rights. However,
the Company will retain all dividends for the participant&#146;s account until the
restrictions on the shares have lapsed or been satisfied.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Deferred stock awards. </I>Deferred stock awards are awards of shares of our
common stock that the participant will not receive until the end of the
deferral period, which is a period of time set by the Compensation Committee at
the time of grant. Deferred stock awards made under the new incentive plan may
be in the form of restricted or unrestricted stock. The Compensation Committee
may impose restrictions on these awards, and the restrictions may lapse at the
end of the deferral period or at earlier specified times.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Performance awards. </I>The Compensation Committee may also grant performance
awards under the new incentive plan. Performance awards are awards the receipt
or value of which (or both) is linked to the market value, book value, net
profits or other measure of the value of a share of our common stock, or to the
appreciation in any of these criteria over a specific period, or to other
performance criteria specified by the Compensation Committee.
</FONT>
<P align="center"><FONT size="2">24</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Dividend equivalent rights. </I>In connection with the award of options,
SARs, deferred stock or performance awards under the new incentive plan, the
Compensation Committee may also grant dividend equivalent rights with respect
to the same number of shares of our common stock subject to the award. Each
dividend equivalent right entitles the holder to receive an amount equal to the
dividends declared on our common stock between the date of grant and the date
the award of options, SARs, deferred stock or performance award is exercised,
vests or expires, as the Compensation Committee determines. The Compensation
Committee will also determine whether amounts payable in respect of dividend
equivalent rights are payable in cash, additional shares of our common stock or
both.
</FONT>
<P align="left"><FONT size="2"><B>Duration of Awards; Vesting; Termination of Employment</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The duration of any option or SAR related to an option granted under the
new incentive plan, which the Compensation Committee will set at the time of
grant, will not exceed ten years. Options and SARs under the new incentive
plan will generally vest monthly at an annual rate of 25% unless the
Compensation Committee or a participant&#146;s employment agreement provides
otherwise. The employment agreements we have with Mr.&nbsp;Enterline, Mr.&nbsp;Hunt, Mr.
Barker and Mr.&nbsp;Bramlett provide that the options initially granted to these
officers will vest monthly at an annual rate of 25%.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Following a termination of employment, vested options and SARs must be
exercised within three months (12&nbsp;months in the case of death or disability),
except that options and SARs terminate immediately upon a termination for cause
as defined in the relevant participant&#146;s employment agreement, or as determined
in the discretion of the Compensation Committee if no employment agreement
exists. Any non-vested option, SARs or other awards issued under the new
incentive plan will be forfeited upon any termination, subject to the
Compensation Committee&#146;s discretion to determine otherwise. The Compensation
Committee will retain the discretion to extend the post-employment exercise
period of an option or SAR and to accelerate vesting of awards under the new
incentive plan.
</FONT>
<P align="left"><FONT size="2"><B>Transferability</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Incentive stock options are transferable only by will or the laws of
descent and distribution. In its discretion, the Compensation Committee may
authorize the initial holder of any non-qualified option to transfer the option
to any of the following:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">the holder&#146;s family member, as that term is defined in the new incentive plan;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">one or more trusts for the exclusive benefit of the holder&#146;s family members;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">a corporation or partnership in which the holder and its
family members are the only shareholders or partners, or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">other persons or parties to whom the holder wishes to
transfer awards for estate planning purposes.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2"><B>Business Combinations and Changes in Capital Structure</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of certain business combination transactions affecting the
Company, awards under the new incentive plan will be treated as follows, in
each case unless such awards are assumed by the surviving entity:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Unvested awards will be canceled.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">25</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Vested but unexercised options will terminate and be cashed
out for the difference between the value of our common stock (based
on the transaction consideration) and the exercise price.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Vested but unexercised SARs unrelated to options will
terminate and be cashed out for the difference between the value of
our common stock (based on the transaction consideration) and the
fair market value of the stock on the date of grant.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Vested deferred stock awards, performance awards and dividend
equivalents will terminate as well, and the holders of these awards
will receive the treatment provided in their individual award
agreements.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">These rules apply in the event of a dissolution or liquidation of the Company,
or a merger or consolidation in which the Company is not the surviving entity
or in which the Company becomes a subsidiary of another entity, or a merger or
consolidation in which the outstanding voting stock of the Company does not
continue to represent more than 50% of the combined voting stock of the Company
or the surviving entity, or upon a spin-off or reverse spin-off by the Company,
or a sale of all or substantially all of the assets of the Company.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of any other change in the corporate structure or outstanding
common stock of the Company, the Compensation Committee has the discretion to
prevent dilution by making equitable adjustments to the number of shares or
class of shares available under the new incentive plan, or to any outstanding
incentive awards.
</FONT>
<P align="left"><FONT size="2"><B>Amendment</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our board and the Compensation Committee may at any time terminate or
modify the terms of the new incentive plan, except that the consent of affected
award holders is required to terminate or modify outstanding awards or terms of
the new incentive plan that affect outstanding awards. In addition,
stockholder approval is required for any amendment that would increase the
number of shares of our common stock available for issuance under the new
incentive plan or the number of options or SARs that may be granted to any
individual during a calendar year, or that would change the class of persons
eligible to receive awards under the plan.
</FONT>
<P align="left"><FONT size="2"><B>Prior Grants; Other Equity Compensation Plans</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject to stockholder approval of this proposal, our Compensation
Committee has granted 12,585,000 options, representing 6.5% of our fully
diluted common stock, to certain of our management employees. Of this number,
8,700,000 options have an exercise price of $0.3121, and the remaining
3,885,000 options have an exercise price of $0.4681. The remaining 7,285,873
shares of our fully diluted common stock authorized for issuance under the new
incentive plan will be reserved for future grants.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table provides information about awards under the new
incentive plan that the Compensation Committee has granted.
</FONT>
<P align="center"><FONT size="2"><B>NEW PLAN BENEFITS</B></FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="79%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><FONT size="1"><B>Name and Principal Position</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number of Options</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Exercise Price ($)</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Larry L. Enterline</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">4,000,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.3121</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Chief Executive Officer</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">1,750,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.4681</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>


<P align="center"><FONT size="2">26</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>



<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="79%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><FONT size="1"><B>Name and Principal Position</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number of Options</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Exercise Price ($)</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">James C. Hunt</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2,000,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.3121</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">President and Chief Financial Officer</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">985,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.4681</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Michael H. Barker</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">1,500,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.3121</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">President &#151; Division Operations</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">750,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.4681</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Ken R. Bramlett, Jr.</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">1,200,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.3121</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Senior Vice President, General Counsel and Secretary</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">400,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.4681</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">All current executive officers as a group</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">8,700,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.3121</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">3,885,000</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0.4681</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">All current directors who are not executive officers, as a group</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">N/A</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">All employees, including current officers who are not executive
officers, as a group</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">0</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">N/A</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If our stockholders do not approve the new incentive plan, these awards,
and the plan itself, will be void and will have no effect.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as described in the table, the benefits or amounts that will be
received by, or allocated to, participants under the new incentive plan cannot
be determined because future grants are subject to the discretion of the
Compensation Committee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The table below contains information about the Company&#146;s compensation
plans as of December&nbsp;29, 2002 under which equity securities of the Company are
authorized for issuance.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="44%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number of securities</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number of</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>remaining available</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>securities to be</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>for future issuance</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>issued upon</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>Weighted-average</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>under equity</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>exercise of</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>exercise price</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>compensation plans</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>outstanding</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>of outstanding</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>(excluding securities</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>options, warrants</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>options, warrants</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>reflected in</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><FONT size="1"><B>Plan category</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>and rights</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>and rights</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>column (a))</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD nowrap align="center"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>(a)</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>(b)</B></FONT></TD>
    <TD><FONT size="1">&nbsp;</FONT></TD>
    <TD nowrap align="center" colspan="3"><FONT size="1"><B>(c)</B></FONT></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Equity
compensation plans
approved by
security holders
(1)</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2,837,635</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">6.63</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2,162,968</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Equity
compensation plans
not approved by
security holders</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">&#151;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><HR size="1" noshade></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><HR size="1" noshade></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><HR size="1" noshade></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Total (2)</FONT></DIV></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2,837,635</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">$</FONT></TD>
    <TD align="right"><FONT size="2">6.63</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right"><FONT size="2">2,162,968</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P>
<HR size="1" width="18%" align="left" noshade>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(1)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">A number of the Company&#146;s employees, including each of the Company&#146;s
executive officers at the end of 2002, and all but one of the Company&#146;s
2002 directors, have irrevocably cancelled any and all rights that they
had to exercise any and all stock options that were previously granted to
them and agreed that all such options would be forfeited to the Company.
These directors and employees held in the aggregate 2,190,030 of the stock
options that were outstanding under the 1995 Stock Option Plan as of
December&nbsp;29, 2002. As a result of these voluntary forfeitures, only
545,445 stock options remain outstanding under the 1995 Stock Option Plan,
and these options have a weighted average exercise price of $9.23 per
share.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">27</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>



<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">&nbsp;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Although the 1995 Stock Option Plan has been terminated and no future
issuances under that plan will be made, these remaining outstanding stock
options will continue to be exercisable in accordance with their terms.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(2)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Excludes 1,734,894 shares reserved at December&nbsp;29, 2002 for issuance
under the Company&#146;s 2001 Non-Qualified Employee Stock Purchase Plan, which
was terminated on December&nbsp;31, 2002.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2"><B>Federal Income Tax Consequences</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following discussion summarizes certain tax consequences of the new
incentive plan under current federal law. This discussion deals with the
general tax principles applicable to the new incentive plan and is intended for
general information only. Alternative minimum tax and state and local income
taxes are not discussed and may vary depending on individual circumstances and
from locality to locality.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There is no taxable income to a plan participant when an incentive stock
option is granted to the participant or when that option is exercised; however,
the amount by which the fair market value of the shares at the time of exercise
exceeds the option price will be an &#147;item of tax preference&#148; for the optionee.
Gain realized by an optionee upon sale of stock issued on exercise of an
incentive stock option is taxable at capital gains rates, and no tax deduction
is available to the Company, unless the optionee disposes of the shares within
two years after the date of grant of the option or within one year of the date
the shares were transferred to the optionee. In such event the difference
between the option exercise price and the fair market value of the shares on
the date of the option&#146;s exercise will be taxed at ordinary income rates, and
the Company will be entitled to a deduction to the extent the employee must
recognize ordinary income. An incentive stock option exercised more than three
months after an optionee&#146;s termination of employment, other than by reason of
death or disability, will be taxed as a non-qualified stock option, with the
optionee deemed to have received income upon such exercise taxable at ordinary
income rates. The Company will be entitled to a tax deduction equal to the
ordinary income, if any, realized by the optionee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For federal income tax purposes, the recipient of non-qualified stock
options granted under the new incentive plan will not have taxable income upon
the grant of the option, nor will the Company then be entitled to any
deduction. Generally, upon exercise of non-qualified stock options the
optionee will realize ordinary income, and the Company will be entitled to a
deduction, in an amount equal to the difference between the option exercise
price and the fair market value of the stock at the date of exercise. An
optionee&#146;s basis for the stock for purposes of determining his gain or loss on
his subsequent disposition of the shares generally will be the fair market
value of the stock on the date of exercise.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No taxable income is realized upon the receipt of a share of restricted
stock. A plan participant to whom restricted stock is issued will not have
taxable income upon issuance, and the Company will not then be entitled to a
deduction, unless in the case of restricted stock an election is made under
Section&nbsp;83(b) of the Internal Revenue Code. However, when restrictions on
shares of restricted stock lapse, such that the shares are no longer subject to
forfeiture to the Company, the participant will realize ordinary income, and
the Company will be entitled to a deduction in an amount equal to the fair
market value of the shares at the date the restrictions lapse, less the
purchase price for the shares. If the participant makes an election under
Section&nbsp;83(b) with respect to restricted stock, he or she will realize ordinary
income at the date of issuance equal to the difference between the fair market
value of the shares at that date less the purchase price for the stock, and the
Company will be entitled to a deduction in the same amount.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred stock awards that consist of shares of restricted stock will have
the consequences described above. For deferred stock awards that consist of
shares of unrestricted stock, the participant will realize ordinary income
equal to the fair market value of the shares, less any purchase price, upon
expiration of the deferral period, and the Company will be entitled to a
deduction in the same amount.
</FONT>
<P align="center"><FONT size="2">28</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The participant will realize ordinary income upon the exercise of SARs and
upon the receipt of performance awards and dividend equivalents paid in cash,
and the Company will be entitled to a deduction in the corresponding amount.
For performance awards and dividend equivalents paid in shares of our common
stock, the participant will realize ordinary income upon receipt of the shares
in an amount equal to the fair market value of the shares, less any purchase
price paid for the award, and the Company will be entitled to a deduction in
the same amount.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All deductions described above to which the Company may be entitled will
be subject to Section&nbsp;162(m) of the Internal Revenue Code. Under Section
162(m), income tax deductions of publicly traded companies may be limited to
the extent total compensation (including base salary, annual bonus, stock
option exercises and non-qualified benefits) for certain executive officers
exceeds $1&nbsp;million (less the amount of any &#147;excess parachute payments&#148; as
defined in Section&nbsp;280G of the Internal Revenue Code) in any one year. It is
the Company&#146;s policy generally to design its equity compensation programs to
conform with Section&nbsp;162(m) so that total compensation paid to any employee
will not exceed $1&nbsp;million in any one year, except for compensation payments in
excess of $1&nbsp;million that qualify as &#147;performance-based.&#148; The Company intends
to comply with the requirements of the performance-based compensation exclusion
under Section&nbsp;162(m), including option pricing requirements and requirements
governing the administration of the new incentive plan, so that the
deductibility of compensation paid to top executives under the plan is not
expected to be disallowed. Stockholder approval of the new incentive plan is
required for awards under the new incentive plan to qualify as
&#147;performance-based&#148; under Section&nbsp;162(m).
</FONT>
<P align="left"><FONT size="2"><B>Vote Required</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Approval of the new incentive plan requires the affirmative vote of
holders of a majority of the outstanding shares of our capital stock
represented at the meeting and entitled to vote on the proposal. Each share of
our Series&nbsp;B preferred stock will count for this purpose as 100 outstanding
shares of common stock. If a stockholder abstains from voting its shares or
directs the stockholder&#146;s proxy to abstain from voting its shares on these
proposals, the shares will be considered present and entitled to vote but will
have the same effect as votes against the proposals. On the other hand, broker
non-votes, if any, will not be considered present and entitled to vote and will
have no effect on the outcome of the vote. However, broker non-votes will have
the practical effect of reducing the number of affirmative votes required to
achieve a majority for these proposals by reducing the total number of shares
from which the majority is calculated.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under Delaware law and the provisions of our certificate of incorporation
and bylaws, you are not entitled to dissenters&#146; rights of appraisal with
respect to the proposed new incentive plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Our board of directors believes the adoption of this proposal 2 is in the
best interests of the Company and its stockholders and recommends that you vote
FOR this proposal. Each proxy card executed and returned will be voted for
this proposal unless contrary instructions are indicated on the proxy card.</B>
</FONT>
<P align="center"><FONT size="2">29</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2"><B>PROPOSALS 3 THROUGH 12 </B>&#151; <B>CHARTER AMENDMENTS</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The next set of proposals for you to consider at the annual meeting seeks
approval of changes to our certificate of incorporation to replace it with the
amended and restated certificate of incorporation attached to this proxy
statement as Annex A, which we refer to as the proposed charter. We agreed in
connection with the financial restructuring we completed on April 14, 2003, to
seek stockholder approval of the proposed charter. The terms of the proposed
charter were established through negotiations with the participating
noteholders who exchanged their 5.75% notes for approximately 82% of the voting
power of our then outstanding voting stock in the restructuring. Three of the
entities to which we issued capital stock in the financial restructuring agreed
to vote in favor of adopting the proposed charter. Together, these three
entities hold approximately 45% of the voting power of our outstanding capital
stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our board of directors has unanimously adopted a resolution approving, and
recommending to our stockholders for approval, a proposal to adopt this
proposed charter. We have separated the significant amendments to our
certificate of incorporation that would be effected by the proposed charter as
separate proposals 3 through 12 to allow you to focus on each significant
change. However, we have conditioned approval of each of proposals 3 through
12 on approval of all of those proposals. Therefore, we believe proposals 3
through 12 should be considered together. If any of proposals 3
through 12 is
not approved, none of them will be approved, even if one or more of those
proposals receives sufficient stockholder votes for approval.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The proposed charter includes a number of significant changes to our
current charter. These changes are broken out for your consideration as
follows:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="95%">
<TR valign="bottom">
    <TD width="14%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="84%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 3</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To effect a reverse stock split of our common stock at a
one-for-twenty-five ratio;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 4</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To eliminate the provision separating our board of directors
into three classes;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 5</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To eliminate the provision prohibiting action by consent of
our common stockholders without a meeting;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 6</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To elect that we not be governed by Section&nbsp;203 of the
Delaware General Corporation Law;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 7</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To require approval by disinterested stockholders of
transactions that would increase the proportionate ownership of a
stockholder that beneficially owns 20% or more of the shares of our
capital stock;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 8</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To require approval by 5% stockholders and 80% of the
directors of corporate transactions involving a stockholder that
beneficially owns 20% or more of the shares of our capital stock;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 9</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To require a supermajority vote of our board of directors or
stockholders to adopt changes to our certificate of incorporation or
bylaws;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 10</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To set the number of directors between seven and nine, with
the exact number to be set in accordance with the bylaws;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 11</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To provide indemnification rights, including rights to
advancement of expenses, to directors and officers to the fullest
extent permitted by law and to permit the board to authorize
indemnification of employees and agents; and</FONT></TD>
</TR>
</TABLE>
</CENTER>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center"><FONT size="2">30</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="95%">
<TR valign="bottom">
    <TD width="14%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="84%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">Proposal 12</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
To amend and restate of our certificate of incorporation to
include the foregoing changes in the event they are approved by the
stockholders and to make other nonsubstantive amendments set forth
in the form of our proposed charter.</FONT></TD>
</TR>
</TABLE>
</CENTER>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Significant differences exist between your rights as a stockholder under
our current charter and under the proposed charter. The material differences
are summarized below. However, this discussion of the proposed charter is
necessarily general. It is not intended to be a complete statement of all
proposed changes that may affect your rights as a stockholder, and it is
qualified in its entirety by reference to the Delaware General Corporation Law,
our current charter, and the form of the proposed charter attached to this
proxy statement as Annex A.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The proposed charter includes a change in the name of our corporation from
&#147;Personnel Group of America, Inc.&#148; to &#147;Venturi Partners, Inc.&#148; Our
stockholders approved this amendment to our certificate of incorporation at our
2002 annual meeting.
</FONT>
<P align="left"><FONT size="2"><B>Proposal 3&#151;Reverse Stock Split</B></FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The proposed charter effects a reverse stock split of our common stock at
a one-for-twenty-five ratio. This means that on the effective date of the
reverse stock split, each 25 shares of our common stock you own will
automatically become one share of our common stock. Any resulting fractional
shares of common stock you own will be cashed out at a price based on per whole
share on the OTC Bulletin Board for the 20 trading days ending on the fifth
trading day before the date on which the proposed charter is filed.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The effective date of the reverse stock split will be the date on which
the proposed charter is filed with the Secretary of State of Delaware. If our
stockholders approve the proposed charter at the annual meeting, we intend to
file the proposed charter as soon after the date of the annual meeting as is
practicable.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Reason for the reverse stock split. </I>The purpose of the proposed reverse
stock split is to increase the per share market price of our common stock and
thereby to improve the likelihood that we will be allowed to obtain a listing
of our common stock on the NASDAQ National Market, the NASDAQ SmallCap Market,
the American Stock Exchange or another national securities exchange, or
otherwise improve the liquidity of our stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our common stock has been traded on the OTC Bulletin Board since the
suspension of trading on the New York Stock Exchange on November&nbsp;21, 2002. Our
common stock was subsequently formally delisted by the New York Stock Exchange
on February&nbsp;28, 2003. If we are unable to obtain listing on one of the
national securities exchanges or trading markets, our common stock would likely
continue to be traded on the OTC Bulletin Board for the foreseeable future.
This may have a negative impact on the liquidity and price of the common stock,
and investors may find it more difficult to purchase or dispose of, or to
obtain accurate quotations as to the market value of, the common stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our board has determined that the listing of our common stock on one or
more of the national securities exchanges or trading markets is in the best
interests of our stockholders. In addition, in our restructuring we agreed to
use our best efforts to obtain such a listing as soon as possible. Inclusion
on one of these national trading markets increases liquidity and may
potentially minimize the spread between the &#147;bid&#148; and &#147;asked&#148; prices quoted by
market makers. Further, a listing on the American Stock Exchange or NASDAQ
National or SmallCap Market may enhance our access to capital and increase our
flexibility in responding to anticipated capital requirements. We believe that
prospective investors will view an investment in us more favorably if our
shares are listed on one of these national trading markets.
</FONT>
<P align="center"><FONT size="2">31</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We also believe that the current per share price level of our common stock
has reduced its effective marketability because many leading brokerage firms
are reluctant to recommend low-priced stocks to their clients. Certain
investors view low-priced stock as speculative and unattractive, although
certain other investors may be attracted to low-priced stock because of the
greater trading volatility sometimes associated with such securities. In
addition, a variety of brokerage house policies and practices tend to
discourage individual brokers within those firms from dealing in low-priced
stock. Such policies and practices pertain to the payment of brokers&#146;
commissions and to time-consuming procedures that function to make the handling
of low-priced stocks unattractive to brokers from an economic standpoint.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Finally, because brokerage commissions on low-priced stock generally
represent a higher percentage of the stock price than commissions on
higher-priced stock, the current share price of our common stock can result in
individual stockholders paying transaction costs (commissions, markups or
markdowns) that represent a higher percentage of their total share value than
would be the case if the share price were substantially higher. This factor
also may limit the willingness of institutions to purchase our common stock at
its current share price.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the trading price of our common stock were to remain at or near its
current level, trading in the common stock would also be subject to the
requirements of certain rules promulgated under the Exchange Act which require
additional disclosures by broker-dealers in connection with any trades
involving a stock defined as a &#147;penny stock&#148; (generally, an equity security
that is not listed on a national trading market and has a market price of less
than $5.00 per share, subject to certain exceptions). In such event, the
additional burdens imposed upon broker-dealers to effect transactions in our
common stock could further limit the market liquidity of the common stock and
the ability of investors to trade it.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In determining to recommend that our stockholders approve the proposed
charter, our board also took into consideration a number of negative factors
associated with reverse stock splits, including:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">the negative perception of reverse stock splits held by many
investors, analysts and other stock market participants;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">the fact that the stock price of some companies that have
recently effected reverse stock splits has subsequently declined
back to pre-reverse stock split levels; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">the fact that having a greater number of outstanding shares
aids employee retention and recruitment by allowing a company to
offer option grants for a larger absolute number of shares.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">The board, however, determined that these negative factors were outweighed by
the intended benefits described above.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There can be no assurance that the reverse stock split, if effected, will
result in the benefits described above. Specifically, there can be no
assurance that the market price of our common stock will rise in proportion to
the reduction in the number of outstanding shares resulting from the reverse
stock split, that the market price of the post-split common stock can be
maintained above the thresholds required for initial listing on one of the
national trading markets listed above $3.00 for the American Stock Exchange;
$5.00 for the NASDAQ National Market; $4.00 for the NASDAQ SmallCap Market) or
that the common stock will not be refused listing on these national trading
markets for other reasons. Should the market price of a share of our common
stock decrease, the percentage decline as an absolute number and as a
percentage of our overall market capitalization may be greater than what would
have occurred in the absence of the reverse stock split. In addition, it is
possible that the reduced number of shares of common stock outstanding after
the reverse stock split will adversely affect the liquidity of the
</FONT>
<P align="center"><FONT size="2">32</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">common stock. Finally, if the price of a share of common stock declines
as a result of the reverse stock split, this will detrimentally impact our
market capitalization and the market value of our public float.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Implementation and effects of the reverse stock split. </I>If the
stockholders approve the proposed charter at the annual meeting and it is
implemented, the following paragraph will be included in the restated
certificate of incorporation filed with the Delaware Secretary of State:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="1%" align="left" nowrap><FONT size="2">&nbsp;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Upon the filing (the &#147;Effective Time&#148;) of this Restated
Certificate of Incorporation pursuant to the &#091;General Corporation
Law of the State of Delaware&#093;, and without further action on the
part of the Corporation or its stockholders: (a)&nbsp;each share of
Common Stock, par value $0.01 per share, of the Corporation shall
be combined on a basis of 1 share for every 25 shares (the
&#147;Reverse Stock Split&#148;); (b)&nbsp;the par value of each share of Common
Stock, par value $0.01 per share, shall be restated to $0.01 per
share; (c)&nbsp;each 25 shares of Common Stock, par value $0.01 per
share, outstanding shall be deemed to represent one share of
Common Stock, par value $0.01 per share; and (d)&nbsp;all fractional
shares resulting from the foregoing shall be eliminated and each
holder thereof shall be entitled to receive a cash payment equal
to such holder&#146;s fraction of a share of Common Stock, par value
$0.01 per share, multiplied by $______ per share. Each certificate
that theretofore represented a share or shares of Common Stock
(the &#147;Original Share Number&#148;) shall thereafter represent that
number of shares of Common Stock equal to the quotient resulting
from the division of the Original Share Number by 25, rounded down
to the nearest whole number, plus cash in respect of any
fractional number of shares resulting from the Reverse Stock Split
as calculated in accordance with clause (d)&nbsp;of the preceding
sentence.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The number to fill in the blank in this provision will be the average per
share final bid price of our common stock on the OTC Bulletin Board for the 20
trading days ending on the fifth trading day preceding the record date for the
reverse split.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As a result of the reverse stock split, each 25 shares of our common stock
outstanding on the effective date of the reverse stock split (the &#147;old common
stock&#148;) will be automatically changed into and become one share of our common
stock (the &#147;new common stock&#148;). We will not issue fractional shares in
connection with the reverse stock split. If a stockholder otherwise would be
entitled to receive a fraction of a share because the number of shares of
common stock he or she holds is not evenly divisible by the selected ratio,
such stockholder will be entitled to receive a cash payment equal to the
fraction of a share multiplied by the average final bid price per share of our
common stock on the OTC Bulletin Board for the 20 trading days ending on the
fifth trading day before the date on which the proposed charter is filed.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The old common stock is currently registered under the Securities Exchange
Act of 1934, and we are subject to the periodic reporting and other
requirements of the Exchange Act. The reverse stock split, if it occurs, will
not affect the registration of our common stock under the Exchange Act.
Following the reverse stock split, our common stock will continue to be
registered under the Exchange Act. It will also continue to be traded on the
OTC Bulletin Board.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The reverse stock split will not affect proportionate voting rights and
other rights and privileges of the holders of our common stock, other than as a
result of adjustments that may occur due to fractional shares. For example, a
holder of 2% of the voting power of the outstanding shares of old common stock
immediately prior to the effective date of the reverse stock split will
continue to hold approximately 2% of the voting power of the outstanding shares
of new common stock after the reverse stock split.
</FONT>
<P align="center"><FONT size="2">33</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The number of authorized shares of our common stock, which currently is 95
million, will not be reduced as a result of the reverse stock split.
Consequently, if the reverse stock split is implemented, the number of
authorized but unissued shares of common stock will increase. Issuance of such
authorized but unissued shares would have the effect of diluting our current
stockholders&#146; equity, earnings per share and book value per share, as well as
the stock ownership and voting rights, of our outstanding common stock.
Issuing these additional shares, or the perception that they may be issued, may
also have an adverse effect on the market price of our stock. The board could
use the increased number of authorized and unissued shares of common stock as
an anti-takeover defense; however, this potential use of the additional
authorized shares was not a factor in the board&#146;s decision to propose the
reverse stock split.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The par value of our common stock will remain at $0.01 per share following
the reverse stock split. As a result of the split, on its effective date, the
stated capital on our balance sheet attributable to our common stock will be
reduced in proportion to the split ratio, and the additional paid-in capital
will be credited with the same amount. Consequently, although the aggregate
par value of our issued common stock &#151; the stated capital &#151; will be reduced,
the reverse stock split will not affect our stockholders&#146; equity in the
aggregate.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the reverse stock split is approved and implemented, each share of our
Series&nbsp;B preferred stock will be convertible into four shares of our common
stock, rather than 100 shares. Proportional adjustments will also be made
under outstanding options and warrants to purchase our common stock, to the
extent those options were not canceled as part of the recent restructuring of
our debt. Similarly, pursuant to the terms of our stockholder protection
rights plan, upon the effective date of the split, a proportionate adjustment
will automatically be made to the exercise price payable upon exercise of the
rights granted to our stockholders under the rights plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If approved, the reverse stock split may result in some stockholders
owning &#147;odd lots&#148; of less than 100 shares of new common stock. Odd lot shares
may be more difficult to sell, and brokerage commissions and other costs of
transactions in odd lots are generally somewhat higher than the costs of
transactions in &#147;round lots&#148; of even multiples of 100 shares.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our Series&nbsp;B preferred stock will become immediately convertible into
common stock when the number of authorized but unissued shares of our common
stock exceeds the number of shares of our common stock into which all of the
then outstanding shares of Series&nbsp;B are convertible. This condition would be
met upon implementation of the reverse stock split. Accordingly, we anticipate
that the holders of our Series&nbsp;B preferred stock will convert their shares soon
after we implement the reverse stock split, if it is approved. As of the date
this proxy statement is being mailed, each share of Series&nbsp;B preferred stock is
convertible into 100 shares of our common stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Exchange of stock certificates following implementation of reverse stock
split. </I>If the reverse stock split is implemented, holders of our common stock
will be required to exchange their stock certificates representing old common
stock for new certificates representing new common stock. Stockholders of
record on the effective date of the reverse stock split will be furnished the
necessary materials and instructions for the surrender and exchange of share
certificates at the appropriate time by Wachovia Bank, National Association,
our transfer agent. Stockholders will not have to pay a transfer fee or other
fee in connection with the exchange of certificates. As soon as practicable
after the effective date, the transfer agent will send a letter of transmittal
to each stockholder advising of the procedure for surrendering certificates
representing shares of old common stock in exchange for new certificates
representing ownership of new common stock. If you are a holder of our common
stock, you should not send your stock certificates now. You should send them
only after you receive the letter of transmittal from the transfer agent.
</FONT>
<P align="center"><FONT size="2">34</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As soon as practicable after the surrender to the transfer agent of any
certificate that represents shares of old common stock, together with a duly
executed letter of transmittal and any other documents the transfer agent may
require you to provide, the transfer agent will deliver to the person in whose
name the certificate for old common stock had been issued certificates
registered in the name of such person representing the appropriate number of
shares of new common stock. Each certificate representing shares of new common
stock will continue to bear any legends restricting the transfer of that shares
that were borne by the surrendered certificates representing the shares of old
common stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any certificate held by you prior to the reverse stock split that
represented shares of old common stock will be deemed at and after the
effective date of the reverse stock split to represent the number of full
shares of new common stock, plus cash for any fractional share of new common
stock. Until you have surrendered your common stock certificates for exchange,
you will not be entitled to receive any dividends or other distributions that
may be declared and payable by us to holders of record of our common stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If your certificate for old common stock has been lost, destroyed or
stolen, you will be entitled to receive a certificate representing the shares
of new common stock into which your shares of old common stock are to be
converted upon compliance with our or the transfer agent&#146;s procedures for
issuing replacement certificates when original certificates are lost, stolen or
destroyed.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Federal income tax consequences. </I>The following discussion summarizes the
material federal income tax consequences of the reverse stock split. It is not
intended as tax advice to any person or entity. It is for general information
only and does not discuss consequences that may apply to special classes of
taxpayers (for example, non-resident aliens, broker-dealers or insurance
companies) or tax consequences under the laws of any foreign, state or local
jurisdictions. We strongly urge you to consult your own tax advisor as to the
specific tax consequences to you of the reverse stock split, including the
application of federal, state, local, foreign and other tax laws.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This discussion is based upon the Internal Revenue Code of 1986, as
amended, the applicable Treasury Regulations promulgated thereunder, judicial
authority and current administrative rulings and practices, all as in effect on
the date of this proxy statement. Changes to these laws could alter the tax
consequences described below, possibly with retroactive effect. We have not
sought and will not seek a ruling from the Internal Revenue Service regarding
the federal income tax consequences of the reverse stock split.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We believe that the reverse stock split will constitute a
&#147;recapitalization&#148; under Section&nbsp;368(a)(1)(E) of the Internal Revenue Code of
1986. Provided that the reverse stock split does constitute a recapitalization
under this provision, for federal income tax purposes:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">We will recognize no gain or loss as a result of the reverse
stock split.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Stockholders who receive new common stock as a result of the
reverse stock split (including any fractional share interests that
they may be deemed to receive as described in the last bullet below)
in exchange for old common stock will recognize no gain or loss.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">The aggregate federal income tax basis of the new common
stock received by a stockholder (including any fractional share
interests that they may be deemed to receive as described in the
last bullet below) will be the same as the aggregate federal income
tax basis of the old common stock surrendered in exchange for the
new common stock.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">The holding period of the new common stock received by a
stockholder (including any fractional share interests that they may
be deemed to receive as described in the bullet</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">35</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>


<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&nbsp;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">below) will include the period during which the old common stock
surrendered in exchange was held, provided that the old common stock
was held as a capital asset by the stockholder on the date of the
exchange.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">The payment of cash in lieu of fractional share interests of
new common stock will be treated as if the fractional shares of new
common stock were distributed as part of the recapitalization and
then redeemed from the stockholder by us. The cash payments will be
treated as having been received as distributions in full payment for
the fractional share interests redeemed, as provided in Section
302(a) of the Internal Revenue Code.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will describe the other significant changes that would be effected by
the proposed charter by company provisions of the proposed charter to
provisions of our current charter.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>Proposal 4&#151;Eliminate Classification of the Board of Directors</B></FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Proposed charter. </I>The proposed charter does not separate the board into
classes with staggered terms of service. Consequently, there will be only one
class of directors on our board, and each member of our board of directors will
serve from his or her election until a successor is duly elected and qualified.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This board structure will enable our stockholders to elect the entire
board of directors at one time. This structure could work to the advantage of
those stockholders that control proportionally large numbers of shares, such as
MatlinPatterson and Inland/Links which collectively beneficially own shares of
capital stock having approximately 45% of the votes that may be cast, because
they may be able to vote to elect their preferred candidates for board
membership to all of the seats on the board at one time. Under our bylaws, all
significant stockholders (as defined below under &#147;&#151;Supermajority Requirement
for Charter and Bylaw Amendments&#148; and which currently include MatlinPatterson
and Inland/Links), acting as a group, are already entitled to nominate two
candidates to our board of directors each year. In addition, assuming they are
elected to the board, the two candidates so nominated will form the majority of
a board committee that will nominate between one and four members of our board
of directors, depending upon the percentage of our stock held by the group of
significant stockholders. This means that under our bylaws, significant
stockholders may effectively control the nomination of up to six of our
directors for each election. Under the proposed charter, these stockholders
may also have the ability to elect all of the nominees that they favor.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Current charter. </I>Our current charter divides our board of directors into
three classes. Each director serves a term of three years from his or her
election, and one third of the seats on the board are open for election at each
annual meeting. Under this staggered structure, a maximum of one third of our
directors can be replaced in any one year. This makes it more difficult for
large stockholders to affect the membership of our board of directors, because
a majority of the seats on board are never subject to election in the same
year.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>Proposal 5&#151;Permit Stockholder Action Without a Meeting</B></FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Proposed charter. </I>The proposed charter will permit stockholders to take
action by their written consent without the need for a stockholders&#146; meeting.
The vote required to take action by written consent will be the same as the
vote required to take action at a meeting. The ability of the stockholders to
act in writing without holding an annual or special meeting will provide us
with additional flexibility to make important corporate decisions without the
delay and expense of holding a stockholders&#146; meeting. The possibility of
stockholder action without a meeting may also make it easier for large
stockholders to affect our decision making, because they may be able to direct
votes from a majority of our voting shares to serve their desired purposes
without involving other stockholders.
</FONT>
<P align="center"><FONT size="2">36</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Current charter. </I>Under the current charter, our stockholders may take
action only at an annual or special stockholders&#146; meeting. The stockholders
cannot take action in writing on any matter without holding such a meeting.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>Proposal 6&#151;Opt Out from Section&nbsp;203 of the Delaware General Corporation Law</B></FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Proposed charter. </I>In the proposed charter, we will elect not to be
governed by Section&nbsp;203 of the Delaware General Corporation Law. Section&nbsp;203
restricts our ability to engage, directly or indirectly, in a business
combination transaction with an interested stockholder. An interested
stockholder is one that holds 15% or more of our voting stock. Specifically,
under Section&nbsp;203, we cannot engage in a business combination with any
interested stockholder for three years after the interested stockholder became
an interested stockholder, unless:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">prior to such time, the board approved the business
combination or the transaction that resulted in the interested
stockholder becoming an interested stockholder;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">upon consummation of the transaction that resulted in the
interested stockholder becoming an interested stockholder, the
interested stockholder owned at least 85% of our outstanding voting
stock, excluding shares owned by our directors who are also officers
and shares held in employee stock plans in which participants do not
have the confidential right to determine whether their plan shares
will be tendered in a tender or exchange offer; or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">the board approves the business combination, and stockholders
holding at least two thirds of our voting stock authorize it at an
annual or special meeting.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">If Section&nbsp;203 does not govern the Company, we may more easily enter into
business combinations with persons or entities that hold substantial
percentages of our capital stock. However, by its terms, Section&nbsp;203 will
continue to apply to us for 12&nbsp;months after stockholder approval of the
proposed charter, and it will apply indefinitely for any interested
stockholders that became interested stockholders prior to stockholder approval.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Current charter. </I>Because we have not elected not to be governed by
Section&nbsp;203 in our current charter, it currently applies to us.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>Proposal 7&#151;Require Disinterested Stockholder Approval of Transactions with 20%
Stockholders that Would Increase Their Proportionate Ownership</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Proposed charter. </I>The proposed charter includes a provision requiring
disinterested stockholder approval before we can enter into certain
transactions that may increase the proportional ownership interest of, or
disproportionately benefit, a significant stockholder. Except as described
below, we must obtain the affirmative vote of a majority of our voting shares
not controlled by the relevant significant stockholder, voting as a single
class, to enter into a transaction that involves any of the following:
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">the acquisition, in one or a series of transactions, of any
of our capital stock, if the effect of the acquisition would be to
give the significant stockholder ownership of 75% or more of our
voting stock; or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">a reclassification of our securities or recapitalization of
us, or a merger or consolidation of us with any of our subsidiaries,
or any other transaction, that has the effect of giving a
significant stockholder ownership of 75% or more of our voting
stock.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">The proposed charter refers to these transactions as control transactions.
</FONT>
<P align="center"><FONT size="2">37</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A control transaction can be completed without a disinterested stockholder
vote if it is approved by a vote of at least 80% of our board of directors, or
if the significant stockholder or its affiliate first makes a qualifying
purchase offer for our capital stock. A qualifying purchase offer is an offer
made to purchase any or all shares of the class of our capital stock the
acquisition of which by the significant holder or its affiliate would
constitute a control transaction, and shares of any class of our capital stock
that this first class is convertible into or exchangeable for or into which it
may be converted. The consideration offered must be at least equal in value to
any consideration the significant stockholder or its affiliate is to pay for
voting stock to be acquired in the control transaction and to any consideration
the significant stockholder or its affiliate paid to acquire voting stock
during the 180-day period prior to the offer. In addition, the offer must
remain open for at least 20 business days and otherwise comply with applicable
federal securities laws.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These provisions protect minority stockholders because they require the
affirmative approval of a supermajority of our board of directors, or of a
majority of our voting shares other than those held by a significant
stockholder or its affiliate, before we can enter into transactions that may
have a disproportionate benefit for the significant stockholder unless the
stockholder or its affiliate has first offered to purchase all other shares of
the relevant classes of stock. These requirements may make it more difficult
for a holder of a proportionally significant number of our shares to exploit
its comparatively large voting power to the disadvantage of our minority
stockholders.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Current charter. </I>Our current charter does not contain any of these
special stockholder approval provisions.
</FONT>
<P align="left"><FONT size="2"><B>Proposal 8&#151;Require Approval by 5% Stockholders and 80% of Directors for
Transactions Involving 20% Stockholders</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Proposed charter. </I>The proposed charter includes a provision requiring the
approval of each stockholder that beneficially owns at least 5% of our voting
stock, and of at least 80% of the board of directors, as a prerequisite to
other transactions between us and our significant stockholders. The following
transactions are subject to approval by these 5% stockholders and 80% of the
board:
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">a liquidation or dissolution of us that any significant
holder beneficially owning more than 50% of our voting stock votes
for or consents to;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">a sale of all or substantially all of our assets to, or an
acquisition of assets from or share subscription in, a significant
holder or its affiliate the value of which exceeds $5&nbsp;million;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">a merger, share exchange or consolidation of us with a
significant stockholder or its affiliate the value of which exceeds
$5&nbsp;million;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">a merger, share exchange or consolidation of us or a
subsidiary, the value of which exceeds $5&nbsp;million, in which a
significant stockholder or its affiliate is entitled to
consideration different in form from or additional to that offered
to other holders of the same class of our securities (with
exceptions for reasonable legal fees, out-of-pocket expenses and
indemnification); or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">any other transaction, or series of related transactions, the
value of which exceeds $5&nbsp;million, between us and a significant
stockholder or its affiliate (other than a subscription for our
shares made available to all of our common stockholders on a pro
rata basis).</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This approval requirement continues to apply with respect to a significant
stockholder for 18&nbsp;months after it ceases to be a significant stockholder.
</FONT>
<P align="center"><FONT size="2">38</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This approval requirement will give the holders of at least 5% of our
voting stock a veto over transactions with our significant stockholders (and
with some former significant stockholders). Because the requirement applies
regardless of whether applicable law or regulations would otherwise require
stockholder approval for a transaction, it may also protect other minority
stockholders by subjecting the transaction to greater scrutiny.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As an additional protection, the charter provides that the provisions
described in this section generally cannot be amended, and no inconsistent
provisions can be adopted, without the approval of 80% of our board and each
holder of at least 5% of our voting stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Current charter. </I>Our current charter does not contain any of these special
stockholder approval provisions.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>Proposal 9&#151;Require Supermajority Vote for Charter and Bylaw Amendments</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Proposed charter. </I>The proposed charter provides that so long as there is
at least one significant stockholder, neither the charter nor our bylaws can be
amended unless the amendment is approved by either:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">our board of directors, including at least one director
designated by the significant stockholders, or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">stockholders with at least 75% of the shares of our capital
stock entitled to vote in the election of our directors.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This provision will make it difficult to amend our charter or bylaws
without the approval of all significant stockholders. A significant
stockholder is one that beneficially owns 20% or more of the shares of our
capital stock that are entitled to vote on matters submitted to a vote of our
stockholders, or voting stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Current charter. </I>Under our current charter and Delaware law, our
stockholders can amend the charter, and either the stockholders or our board of
directors can amend our bylaws, by a simple majority vote.
</FONT>
<P align="left"><FONT size="2"><B>Proposal 10&#151;Set Number of Directors Between Seven and Nine</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Proposed charter. </I>The proposed charter sets the size of the board of
directors between seven and nine members, with the exact number of directors to
be specified in the manner set forth in our bylaws. Our bylaws currently
permit our board of directors to set the size of the board from between seven
and nine members, with the current number of directors being seven.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Current charter. </I>Our current charter provides that the size of the board
of directors shall be as set forth from time to time in the bylaws as amended
by the board of directors or the stockholders.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;By setting the range of the board in the certificate of incorporation, the
proposed charter will make it more difficult to decrease the size of the board
below seven or to expand the board beyond nine members. In addition, the
proposed charter will deprive the stockholders of the ability to act to set the
size of the board, which they can do now under the current charter by adopting
an amendment to the bylaws.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">39</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>Proposal 11&#151;Provide Indemnification Rights for Directors and Officers</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Proposed charter. </I>The proposed charter would require our corporation to
indemnify the directors and officers to the fullest extent authorized or
permitted by law, and that these indemnification rights would continue after
the director or officer ceases to be a director or officer. Under the proposed
charter, our corporation would not be obligated to indemnify any director or
officer in connection with a proceeding initiated by that director or officer
unless the proceeding was authorized or consented to by the board of directors.
The right to indemnification under the proposed charter would include the
right to be paid expenses incurred in defending or otherwise participating in
any proceeding in advance of its final disposition. The proposed charter would
also permit our corporation, to the extent authorized from time to time by the
board of directors, to provide rights to indemnification and to the advancement
of expenses to employees and agents similar to those conferred to directors and
officers under the proposed charter. The rights to indemnification and to the
advance of expenses under the proposed charter would not be exclusive of any
other right existing under our bylaws, any statute, agreement, vote of
stockholders or disinterested directors or otherwise. Further, rights to
indemnification and advancement of expenses would not be affected by any repeal
or modification of our certificate of incorporation with respect to any prior
acts or omissions.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subsection (a)&nbsp;of Section&nbsp;145 of the General Corporation Law of the State
of Delaware empowers a corporation to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the corporation)
by reason of the fact that he is or was a director, officer, employee or agent
of the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys&#146;
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subsection (b)&nbsp;of Section&nbsp;145 empowers a corporation to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that such
person acted in any of the capacities set forth above, against expenses
(including attorneys&#146; fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, except that no indemnification may be
made in respect of any claim, issue or matter as to which such person shall
have been made to be liable to the corporation unless and only to the extent
that the Court of Chancery or the court in which such action or suit was
brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the Court
of Chancery or such other court shall deem proper.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Section&nbsp;145 further provides that to the extent a director or officer of a
corporation has been successful on the merits or otherwise in the defense of
any action, suit or proceeding referred to in subsections (a)&nbsp;and (b)&nbsp;of
Section&nbsp;145 in the defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys&#146; fees) actually and
reasonably incurred by him in connection therewith; that indemnification
provided for by Section&nbsp;145 shall not be deemed exclusive of any other rights
to which the indemnified party may be entitled; that indemnification provided
for by Section&nbsp;145 shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a director, officer,
employee or agent and shall inure to the benefit of such person&#146;s heirs,
executors and administrators; and empowers the corporation to purchase and
maintain insurance on behalf of a director or officer of the corporation
against any liability asserted against him and incurred by him in
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">40</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">any such capacity, or arising out of his status as such whether or not the
corporation would have the power to indemnify him against such liabilities
under Section&nbsp;145.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Current charter. </I>Our current charter does not include any provision for
indemnification rights of any person. However, our bylaws currently require
our corporation to indemnify our directors, officers and employees to the
fullest extent permitted by law, with rights to advancement of expenses and
continuation of indemnification consistent with the proposed charter.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;By including indemnification rights in our certificate of incorporation
rather than solely in our bylaws, the proposed charter would make it more
difficult to amend the indemnification rights, since amendments to our
certificate of incorporation require both board of director and stockholder
approval.
</FONT>
<P align="left"><FONT size="2"><B>Proposal 12&#151;Restate our Certificate of Incorporation</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The proposed charter includes the changes described in proposals 3 through
11 and also includes several changes in the language of our certificate of
incorporation. Except as described in Proposals 3 through 11, the changes made
by the proposed charter are nonsubstantive. These nonsubstantive changes
result from the proposed charter being based on a form of restated certificate
of incorporation proposed by the participating noteholders in our negotiations,
rather than being based on our current certificate of incorporation. These
changes include:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">the addition of the name of
our registered agent and the address of
our registered office in the State of Delaware;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">clarification that shares of our common stock (i)&nbsp;do not
carry cumulative voting rights or preemptive rights to purchase
additional shares of our capital stock, (ii)&nbsp;must be treated equally
in a merger, consolidation or liquidation, (iii)&nbsp;are entitled to
dividends when and as declared by our board of directors, and (iv)
may be issued and repurchased as our board of directors may from
time to time determine;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">reordering of the language authorizing the board of directors
to determine the rights and preferences of a series of unissued
preferred stock;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">clarification that the board of directors shall manage the
business and affairs of our corporation;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">clarification that the meetings of stockholders may be held
within or outside the State of Delaware and that corporate records
may be maintained outside the State of Delaware; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">nonsubstantive changes in the language of the article
providing that directors shall not be personally liable to the
corporation or the stockholders for monetary damages for a breach of
fiduciary duty to the fullest extent permitted the Delaware General
Corporation Law.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">In proposal 12, we are seeking stockholder approval to amend and restate our
certificate of incorporation to reflect the amendments described in proposals 3
through 11, in the event those proposals are approved by the stockholders, and
to reflect those other nonsubstantive amendments that would be effected by adoption of the
proposed charter.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">41</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="left"><FONT size="2"><B>Vote Required</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Approval of each of proposals 3 through 12 requires the affirmative vote
of the holders of a majority of the shares of our outstanding capital stock
(counting each share of our Series&nbsp;B preferred stock, for these purposes, as
100 outstanding shares of common stock). You should instruct your broker how
to vote your shares following the directions your broker provides to you for
doing so. If you do not provide instructions to your broker, your shares will
not be voted on this proposal. Abstentions will have the same effect as
negative votes on this proposal. <B>A failure to vote (other than a broker
non-vote) or a vote to abstain will have the same legal effect as a vote cast
against approval of our restated certificate of incorporation. </B>We have
conditioned approval of each of proposals 3 through 12 on approval of all of
these proposals. If any of proposals 3 through 12 is not approved, none of
them will be approved, even if one or more of these proposals receives
sufficient stockholder votes for approval.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under Delaware law and the provisions of our current certificate of
incorporation and bylaws, you are not entitled to dissenters&#146; rights of
appraisal with respect to the proposed amendments to our certificate of
incorporation.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Our board of
directors believes the adoption of proposals 3 through 12 is
in the best interests of the Company and its stockholders and recommends that
you vote FOR each of these proposals. Each proxy card executed and returned
will be voted for each of these proposals unless contrary instructions are
indicated on the proxy card.</B>
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">42</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="left"><FONT size="2"><B>PROPOSAL 13&#151;RATIFICATION OF SELECTION OF INDEPENDENT PUBLIC ACCOUNTING FIRM</B></FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The board of directors, on the recommendation of our Audit Committee, has
selected PricewaterhouseCoopers as our independent auditors for the year ending
December&nbsp;28, 2003.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;One or more representatives of PricewaterhouseCoopers will be present at
this annual meeting, will have the opportunity to make a statement if they
desire to do so and are expected to be available to respond to appropriate
questions from stockholders. We have been advised by PricewaterhouseCoopers
that the firm did not have any direct financial interest or any material
interest in us and our subsidiaries during the 2002 fiscal year.
</FONT>
<P align="left"><FONT size="2"><B>Audit Fees</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Aggregate fees billed by PricewaterhouseCoopers LLP for fiscal year 2002
audit services and the review of the financial statements included in quarterly
reports on Form&nbsp;10-Q during 2002 totaled $285,000.
</FONT>
<P align="left"><FONT size="2"><B>Financial Information Systems Design and Implementation Fees</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;PricewaterhouseCoopers did not render any services to us related to
financial information systems design and implementation during fiscal year
2002.
</FONT>
<P align="left"><FONT size="2"><B>All Other Fees</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Aggregate fees billed for all other audit-related services rendered by
PricewaterhouseCoopers for fiscal year 2002 were $81,685. The services
provided under this category included restructuring advisory services, audits
of employee benefits plans, accounting advisory services and a review of the
Company&#146;s information technology controls. Aggregate fees billed by
PricewaterhouseCoopers for fiscal year 2002 for tax return preparation were
$202,585, and aggregate fees for technical tax consulting services were
$200,369.
</FONT>
<P align="left"><FONT size="2"><B>Vote Required</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Approval of this proposal requires the affirmative vote of holders of a
majority of the outstanding shares of our capital stock represented at the
meeting and entitled to vote on the proposal. Each share of our Series&nbsp;B
preferred stock will count for this purpose as 100 outstanding shares of common
stock. If a stockholder abstains from voting its shares or directs the
stockholder&#146;s proxy to abstain from voting its shares on these proposals, the
shares will be considered present and entitled to vote but will have the same
effect as votes against the proposals. On the other hand, broker non-votes, if
any, will not be considered present and entitled to vote and will have no
effect on the outcome of the vote. However, broker non-votes will have the
practical effect of reducing the number of affirmative votes required to
achieve a majority for these proposals by reducing the total number of shares
from which the majority is calculated.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the stockholders vote negatively, our board of directors will consider
a change in independent auditors for the next fiscal year.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adoption of this proposal is not conditioned upon approval of any of the
other proposals. Under Delaware law and the provisions of our certificate of
incorporation and by laws, you are not entitled to dissenters&#146; rights of
appraisal with respect to this proposal.
</FONT>
<P align="center"><FONT size="2">43</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="center"><FONT size="4"></FONT>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>The board of directors unanimously recommends a vote FOR the proposal to
ratify the selection of PricewaterhouseCoopers as our independent auditors for
the fiscal year ending December&nbsp;28, 2003.</B>
</FONT>
<P align="left"><FONT size="2"><B>Audit Committee Report</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In connection with the December&nbsp;29, 2002 financial statements, our Audit
Committee:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">reviewed and discussed the audited financial statements with
management;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">discussed with the independent auditors the matters required by
Statement on Auditing Standards No.&nbsp;61; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">received the written disclosures and the letter and discussed with
the independent auditors the matters required by Independence Standards
Board Statement No.&nbsp;1 and considered the compatibility of non-audit
services with the auditors&#146; independence.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based upon these reviews and discussions, the Audit Committee recommended
to our board of directors, and our board of directors approved, that our
audited financial statements be included in the Securities and Exchange
Commission Annual Report on Form&nbsp;10-K for the fiscal year ended December&nbsp;29,
2002.
</FONT>
<P align="right"><FONT size="2">2002 Audit Committee:
</FONT>
<P align="right"><FONT size="2">James V. Napier, Chairman<BR>
William J. Simione, Jr.<BR>
Janice L. Scites
</FONT>
<P align="center"><FONT size="2">44</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>STOCKHOLDERS&#146; PROPOSALS</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;December&nbsp;20, 2002 was the deadline to present proposals for consideration
at our 2003 annual meeting of stockholders.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stockholders who intend to present proposals for consideration at our 2004
annual meeting of stockholders are advised that any such proposal must be
received by the Secretary of the Company by no later than the close of business
on ____________, 2003, if such proposal is to be considered for inclusion in the
proxy statement and proxy appointment form relating to that meeting. Only
persons who have held beneficially or of record at least $2,000 in market
value, or 1% of the outstanding common stock, for at least one year on the date
the proposal is submitted and who continue in such capacity through the meeting
date are eligible to submit proposals to be considered for inclusion in the
proxy statement for any of our annual meetings.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition, our bylaws prescribe procedures a stockholder must follow to
make nominations for director candidates or propose any other business to be
considered at an annual meeting. Stockholder nominations for director
candidates or other proper stockholder business will be considered at an annual
meeting or a annual meeting of stockholders if the stockholder (who must be, at
the time of delivery of notice, a stockholder of record) delivers to the
Secretary of our company a timely notice setting forth the information
specified in Section&nbsp;1.2 and, if applicable, Section&nbsp;2.4 of our bylaws. In the
case of an annual meeting, such notice will be considered timely if delivered
not less than 60&nbsp;days, nor more than 90&nbsp;days, prior to the first anniversary of
the preceding year&#146;s annual meeting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If, however, the annual meeting date is more than 30&nbsp;days before or after
the anniversary date of the preceding year&#146;s annual meeting, the notice will be
considered timely if received not later than the close of business on the 10th
day following the day on which we first make public announcement of the date of
the meeting or mail public notice of the meeting, whichever occurs first.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any stockholder desiring a copy of our bylaws will be furnished one
without charge upon written request to our Secretary.
</FONT>
<P align="center"><FONT size="2">45</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<P align="center"><FONT size="4"><B>PRELIMINARY PROXY STATEMENT</B></FONT>

<P align="center"><FONT size="2"><B>OTHER BUSINESS</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We know of no other business to be brought before the annual meeting. If,
however, any other business should properly come before the annual meeting, the
persons named in the accompanying proxy will vote proxies as in their
discretion they may deem appropriate, unless they are directed by a proxy to do
otherwise.
</FONT>
<P align="center"><FONT size="2">46</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<!-- link2 "Annex A" -->
<P align="right"><FONT size="2"><B>Annex A</B></FONT>

<P align="center"><FONT size="2"><B>FORM OF</B></FONT>

<P align="center"><FONT size="2"><B>RESTATED</B></FONT>

<P align="center"><FONT size="2"><B>CERTIFICATE OF INCORPORATION</B></FONT>

<P align="center"><FONT size="2"><B>OF</B></FONT>

<P align="center"><FONT size="2"><B>PERSONNEL GROUP OF AMERICA, INC.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned, Larry Enterline, certifies that he is the Chief Executive
Officer of Personnel Group of America, Inc. (the &#147;Corporation&#148;), a corporation
organized and existing under the General Corporation Law of the State of
Delaware (the &#147;GCL&#148;), and does hereby further certify as follows:
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The name of the Corporation is Personnel Group of America, Inc. and the
Corporation was originally incorporated under the name Personnel Group of
America, Inc.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The original certificate of incorporation of the Corporation was filed
with the Secretary of State of the State of Delaware on July&nbsp;7, 1995 and the
original restated certificate of incorporation of the Corporation (the
&#147;Original Restated Certificate of Incorporation&#148;) was filed with the Secretary
of State of the State of Delaware on July&nbsp;28, 1995.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Restated Certificate of Incorporation was duly adopted by the
Board of Directors of the Corporation (the &#147;Board of Directors&#148;) and by the
stockholders of the Corporation in accordance with Sections&nbsp;242 and 245 of the
GCL.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Restated Certificate of Incorporation restates and integrates and
further amends the Original Restated Certificate of Incorporation, as
heretofore amended or supplemented.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon the filing (the &#147;Effective Time&#148;) of this Restated Certificate of
Incorporation pursuant to the GCL, and without further action on the part of
the Corporation or its stockholders: (a)&nbsp;each share of Common Stock, par value
$0.01 per share, of the Corporation shall be combined on a basis of 1 share for
every 25 shares (the &#147;Reverse Stock Split&#148;); (b)&nbsp;the par value of each share of
Common Stock, par value $0.01 per share, shall be restated to $0.01 per share;
(c)&nbsp;each 25 shares of Common Stock, par value $0.01 per share, outstanding
shall be deemed to represent one share of Common Stock, par value $0.01 per
share; and (d)&nbsp;all fractional shares resulting from the foregoing shall be
eliminated and each holder thereof shall be entitled to receive a cash payment
equal to such holder&#146;s fraction of a share of Common Stock, par value $0.01 per
share, multiplied by
$<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> per share. Each certificate that theretofore
represented a share or shares of Common Stock (the &#147;Original Share Number&#148;)
shall thereafter represent that number of shares of Common Stock equal to the
quotient resulting from the division of the Original Share Number by 25,
rounded down to the nearest whole number, plus cash in respect
</FONT>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">of any fractional number of shares resulting from the Reverse Stock Split
as calculated in accordance with clause (d)&nbsp;of the preceding sentence.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The text of the Original Restated Certificate of Incorporation is
hereby amended and restated to read in its entirety as follows:
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>First</U>. The name of the corporation is Venturi Partners, Inc. (the
&#147;Corporation&#148;).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Second</U>. The address of the Corporation&#146;s registered office in the State
of Delaware is The Corporation Trust Company, The Corporation Trust Center,
1209 Orange Street, Wilmington, Delaware 19801, County of New Castle. The name
of its registered agent at such address is The Corporation Trust Company.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Third</U>. The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of Delaware (the &#147;GCL&#148;).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Fourth</U>.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp; Authorized Capital Stock. The total number of shares of all classes
of stock which the Corporation shall have authority to issue is one hundred
million (100,000,000), of which ninety-five million (95,000,000) shares, par
value $0.01 per share, shall be designated as &#147;Common Stock&#148; and five million
(5,000,000) shares, par value $0.01 per share, shall be designated as
&#147;Preferred Stock&#148;. Subject to the terms of any serial designations for any
series of Preferred Stock, the number of authorized shares of Common Stock or
any series of Preferred Stock may be increased or decreased (but not below the
number of shares thereof then outstanding) by the affirmative vote of the
holders of a majority of the outstanding shares entitled to vote, voting
together as a single class, irrespective of the provisions of Section&nbsp;242(b)(2)
of the GCL or any corresponding provision hereafter enacted.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; Common Stock. The powers, preferences and rights, and the
qualifications, limitations and restrictions, of each class of the Common Stock
are as follows:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;No Cumulative Voting. The holders of shares of Common
Stock shall not have cumulative voting rights.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;Dividends; Stock Splits. Subject to the rights of the
holders of Preferred Stock, and subject to any other provisions of
this Restated Certificate of Incorporation, as it may be amended
from time to time, holders of shares of Common Stock shall be
entitled to receive such dividends and other distributions in cash,
stock or property of the Corporation when, as and if declared
thereon by the Board of Directors from time to time out of assets
or funds of the Corporation legally available therefor.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;Liquidation, Dissolution, Etc. In the event of any
liquidation, dissolution or winding up (either voluntary or
involuntary) of the Corporation, the holders of shares of Common
Stock shall be entitled to receive the assets and funds of the
Corporation available for distribution after payments to</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">2</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">creditors and to the holders of any Preferred Stock of the
Corporation that may at the time be outstanding, in proportion to
the number of shares held by them, respectively.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;Merger, Etc. In the event of a merger or consolidation
of the Corporation with or into another entity (whether or not the
Corporation is the surviving entity), the holders of each share of
Common Stock shall be entitled to receive the same per share
consideration on a per share basis.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;No Preemptive Or Subscription Rights. No holder of shares
of Common Stock shall be entitled to preemptive or subscription
rights.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;Power To Sell And Purchase Shares. Subject to the
requirements of applicable law, the Corporation shall have the
power to issue and sell all or any part of any shares of any class
of stock herein or hereafter authorized to such persons, and for
such consideration, as the Board of Directors shall from time to
time, in its discretion, determine, whether or not greater
consideration could be received upon the issue or sale of the same
number of shares of another class, and as otherwise permitted by
law. Subject to the requirements of applicable law, the
Corporation shall have the power to purchase any shares of any
class of stock herein or hereafter authorized from such persons,
and for such consideration, as the Board of Directors shall from
time to time, in its discretion, determine, whether or not less
consideration could be paid upon the purchase of the same number of
shares of another class, and as otherwise permitted by law.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp; Preferred Stock. Shares of Preferred Stock may be issued in one or
more series from time to time by the Board of Directors, and the Board of
Directors is expressly authorized to fix for each such class or series such
voting powers, full or limited, or no voting powers and such designations,
preferences and relative participating optional or other special rights and
such qualifications, limitations and restrictions thereof, as shall be stated
and expressed in the resolution or resolutions adopted by the Board of
Directors providing for the issuance of such class or series, in each case
subject to the terms of this Restated Certificate of Incorporation including
without limitation the following:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;the distinctive serial designation of such series which
shall distinguish it from other series;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;the number of shares included in such series;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;the dividend rate (or method of determining such rate)
payable to the holders of the shares of such series, any conditions
upon which such dividends shall be paid and the date or dates upon
which such dividends shall be payable;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;whether dividends on the shares of such series shall be
cumulative and, in the case of shares of any series having
cumulative dividend</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">3</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">rights, the date or dates or method of determining the date or
dates from which dividends on the shares of such series shall be
cumulative;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;the amount or amounts which shall be payable out of the
assets of the Corporation to the holders of the shares of such
series upon voluntary or involuntary liquidation, dissolution or
winding up the Corporation, and the relative rights of priority, if
any, of payment of the shares of such series;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;the price or prices at which, the period or periods
within which and the terms and conditions upon which the shares of
such series may be redeemed, in whole or in part, at the option of
the Corporation or at the option of the holder or holders thereof
or upon the happening of a specified event or events;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;the obligation, if any, of the Corporation to purchase
or redeem shares of such series pursuant to a sinking fund or
otherwise and the price or prices at which, the period or periods
within which and the terms and conditions upon which the shares of
such series shall be redeemed or purchased, in whole or in part,
pursuant to such obligation;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;whether or not the shares of such series shall be
convertible or exchangeable, at any time or times at the option of
the holder or holders thereof or at the option of the Corporation
or upon the happening of a specified event or events, into shares
of any other class or classes or any other series of the same or
any other class or classes of stock of the Corporation, and the
price or prices or rate or rates of exchange or conversion and any
adjustments applicable thereto; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;whether or not the holders of the shares of such series
shall have voting rights, in addition to the voting rights provided
by law, and if so the terms of such voting rights.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Fifth</U>. The following provisions are inserted for the management of the
business and the conduct of the affairs of the Corporation, and for further
definition, limitation and regulation of the powers of the Corporation and of
its directors and stockholders:
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp; The business and affairs of the Corporation shall be managed by or
under the direction of the Board of Directors.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; The Board of Directors shall consist of not less than seven (7)&nbsp;nor
more than nine (9)&nbsp;members, the exact number of which shall be fixed from time
to time in the manner provided in the By-Laws of the Corporation, as amended
from time to time (the &#147;By-Laws&#148;). The number of directors constituting the
Board of Directors shall be fixed at seven (7)&nbsp;as of the date hereof. Election
of directors need not be by written ballot unless the By-Laws so provide.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp; In addition to the powers and authority hereinbefore or by statute
expressly conferred upon them, the directors are hereby empowered to exercise
all such powers and do all such acts and things as may be exercised or done by
the Corporation, subject,
</FONT>
<P align="center"><FONT size="2">4</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">nevertheless, to the provisions of the GCL, this Restated Certificate of
Incorporation, and any By-Laws adopted by the stockholders; <U>provided</U>, <U>however</U>,
that no By-Laws hereafter adopted by the stockholders shall invalidate any
prior act of the directors which would have been valid if such By-Laws had not
been adopted.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Sixth</U>. No director shall be personally liable to the Corporation or any
of its stockholders for monetary damages for breach of fiduciary duty as a
director, except to the extent such exemption from liability or limitation
thereof is not permitted under the GCL as the same exists or may hereafter be
amended. If the GCL is amended hereafter to authorize the further elimination
or limitation of the liability of directors, then the liability of a director
of the Corporation shall be eliminated or limited to the fullest extent
authorized by the GCL, as so amended. Any repeal or modification of this
Article&nbsp;Sixth shall not adversely affect any right or protection of a director
of the Corporation existing at the time of such repeal or modification with
respect to acts or omissions occurring prior to such repeal or modification.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Seventh</U>. The Corporation shall indemnify its directors and officers to
the fullest extent authorized or permitted by law, as now or hereafter in
effect, and such right to indemnification shall continue as to a person who has
ceased to be a director or officer of the Corporation and shall inure to the
benefit of his or her heirs, executors and personal and legal representatives;
<U>provided</U>, <U>however</U>, that, except for proceedings to enforce rights to
indemnification, the Corporation shall not be obligated to indemnify any
director or officer (or his or her heirs, executors or personal or legal
representatives) in connection with a proceeding (or part thereof) initiated by
such person unless such proceeding (or part thereof) was authorized or
consented to by the Board of Directors. The right to indemnification conferred
by this Article&nbsp;Seventh shall include the right to be paid by the Corporation
the expenses incurred in defending or otherwise participating in any proceeding
in advance of its final disposition.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Corporation may, to the extent authorized from time to time by the
Board of Directors, provide rights to indemnification and to the advancement of
expenses to employees and agents of the Corporation similar to those conferred
in this Article&nbsp;Seventh to directors and officers of the Corporation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The rights to indemnification and to the advance of expenses conferred in
this Article&nbsp;Seventh shall not be exclusive of any other right which any person
may have or hereafter acquire under this Restated Certificate of Incorporation,
the By-Laws, any statute, agreement, vote of stockholders or disinterested
directors or otherwise.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any repeal or modification of this Article&nbsp;Seventh shall not adversely
affect any rights to indemnification and to the advancement of expenses of a
director or officer of the Corporation existing at the time of such repeal or
modification with respect to any acts or omissions occurring prior to such
repeal or modification.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Eighth</U>. Meetings of stockholders may be held within or without the State
of Delaware, as the By-Laws may provide. The books of the Corporation may be
kept (subject to any provision contained in the GCL) outside the State of
Delaware at such place or places as may be designated from time to time by the
Board of Directors or in the By-Laws.
</FONT>
<P align="center"><FONT size="2">5</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Ninth</U>. In furtherance and not in limitation of the powers conferred upon
it by the laws of the State of Delaware, the Board of Directors shall have
concurrent power with the stockholders to adopt, amend, alter, add to or repeal
the By-Laws. Notwithstanding any other provision of this Restated Certificate
of Incorporation (and in addition to any other vote that may be required by
law), for so long as there is a Significant Holder, either (i)&nbsp;the approval of
the Board of Directors, including the affirmative vote of at least one of the
persons designated as nominees by the Significant Holder prior to their
election to the Board of Directors and in accordance with the terms of the
By-Laws (&#147;Significant Holder Designees&#148;), or (ii)&nbsp;the affirmative vote of the
holders of at least seventy-five percent (75%) of the voting power of the
shares entitled to vote generally in the election of directors shall be
required to amend, alter, add to or repeal the By-Laws (including by merger,
consolidation, recapitalization or otherwise).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Tenth</U>. The Corporation hereby elects not to be governed by Section&nbsp;203 of
the GCL pursuant to Section&nbsp;203(b)(3) therein.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Eleventh</U>. The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Restated Certificate of Incorporation in
the manner now or hereafter prescribed in this Restated Certificate of
Incorporation, the By-Laws or the GCL, and all rights herein conferred upon
stockholders are granted subject to such reservation; provided, however, that,
notwithstanding any other provision of this Restated Certificate of
Incorporation (and in addition to any other vote that may be required by law),
for so long as there is a Significant Holder:
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp; subject to the following paragraph (b), either (i)&nbsp;the recommendation
or approval of the Board of Directors, including the recommendation or
affirmative vote of at least one of the Significant Holder Designees, or (ii)
the affirmative vote of the holders of at least seventy-five percent (75%) of
the voting power of the shares entitled to vote generally in the election of
directors, shall be required to amend, alter, change or repeal any provision of
this Restated Certificate of Incorporation or to adopt any provisions
inconsistent with the purpose and intent thereof (including by merger,
consolidation, recapitalization or otherwise); and
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; the approval or affirmative vote of (i)&nbsp;any and each Five Percent
Holder and (ii)&nbsp;the Board of Directors by a vote of at least eighty percent
(80%) of the entire Board of Directors shall be required to amend, alter,
change or repeal Article&nbsp;Twelfth or to adopt any provisions inconsistent with
the purpose and intent of Article&nbsp;Twelfth hereof (including by merger,
consolidation, recapitalization or otherwise) but excluding any amendment,
alteration, change or repeal in connection with a merger, consolidation or
similar transaction with an entity that is not a Significant Holder or
Controlled or Controlling Affiliate thereof or a Subsidiary of the Corporation
and that has the result of causing the stockholders of the Corporation
immediately prior to such transaction to beneficially own less than fifty
percent (50%) of the voting power of the shares entitled to vote generally in
elections of directors of the Corporation or the corporation surviving or
resulting from such transaction and less than fifty percent (50%) of the
outstanding shares of Common Stock or common stock of the surviving or
resulting corporation.
</FONT>
<P align="center"><FONT size="2">6</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Twelfth</U>.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp; <U>Control Transactions</U>.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;In addition to any affirmative vote required by law or
this Restated Certificate of Incorporation or the By-Laws, and
except as otherwise expressly provided in Section (a)(ii) of this
Article&nbsp;Twelfth, a Control Transaction shall require the
affirmative vote of not less than fifty percent (50%) of the votes
actually cast by the holders of all the then outstanding shares of
Voting Stock, voting together as a single-class, excluding Voting
Stock beneficially owned by any Significant Holder, or any
Controlled or Controlling Affiliate thereof, proposing to effect
the Control Transaction. Such affirmative vote shall be required
notwithstanding the fact that no vote may be required, or that a
lesser percentage or separate class vote may be specified, by law
or in any agreement with any national securities exchange or
otherwise.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;The provisions of Section (a)(i) of this Article&nbsp;Twelfth
shall not be applicable to any particular Control Transaction, and
such Control Transaction shall require only such affirmative vote,
if any, as is required by law or by any other provision of this
Restated Certificate of Incorporation or the By-Laws, or any
applicable rule or listing standard of any securities exchange or
market on which any of the Corporation&#146;s securities are listed or
approved for trading, if all of the conditions specified in either
of the following paragraphs (A)&nbsp;or (B)&nbsp;are met (any Control
Transaction that satisfies the conditions in paragraphs (A)&nbsp;or (B)
or in Section (a)(i) of this Article&nbsp;Twelfth being, an &#147;Approved
Control Transaction&#148;):</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="6%"></TD>
        <TD width="94%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A&nbsp; Prior to the consummation of the Control
Transaction, it shall have been approved by the
Board of Directors by a vote of at least eighty
percent (80%) of the entire Board of Directors.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B&nbsp; Prior to consummating the Control
Transaction, the Significant Holder, or any
Controlled or Controlling Affiliate thereof,
proposing to effect such a Control Transaction
shall have made an offer to all of the holders
of shares of the class of Capital Stock the
acquisition of which by a Significant Holder, or
any Controlled or Controlling Affiliate thereof,
would give rise to the proposed Control
Transaction (the &#147;Target Stock&#148;) and on a
proportionate basis to all holders of shares of
any class of Capital Stock that is convertible
into or exchangeable for Target Stock or into or
for which Target Stock is convertible or
exchangeable, for the purchase of any or all of
such shares (&#147;Qualifying Offer&#148;), which offer
remains open for at least twenty (20)&nbsp;business
days and otherwise complies with the rules and
regulations of the Securities Exchange Act of
1934, as amended (the &#147;Act&#148;) and which offer is
made for consideration that is at least</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">7</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="6%"></TD>
        <TD width="94%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">equal to or greater than any other
consideration to be paid by the Significant
Holder, or the Controlled or Controlling
Affiliate, for Voting Stock to be acquired in
the Control Transaction or that was paid by the
Significant Holder, or the Controlled or
Controlling Affiliate, for Voting Stock during
the one hundred and eighty (180)&nbsp;days preceding
the commencement of the Qualifying Offer;
provided that any such Control Transaction shall
be consummated within ninety (90)&nbsp;days of the
expiration of the Qualifying Offer.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;Anything to the contrary herein notwithstanding, the
provisions of this Article&nbsp;Twelfth shall not apply to any
transaction following the consummation of an Approved Control
Transaction.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; <U>Related-Party Transactions</U>. In addition to any affirmative vote
required by law or this Restated Certificate of Incorporation or the By-Laws, a
Related-Party Transaction shall require the approval or affirmative vote of (i)
any and each Five Percent Holder prior to the consummation of such
Related-Party Transaction and (ii)&nbsp;the Board of Directors by a vote of at least
eighty percent (80%) of the entire Board of Directors prior to the consummation
of such Related-Party Transaction. Such affirmative vote or approval shall be
required notwithstanding the fact that no vote may be required, or that a
lesser or separate class vote may be specified, by law or in any agreement with
any national securities exchange or otherwise.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp; The following definitions shall apply with respect to this Restated
Certificate of Incorporation:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;The term &#147;Control Transaction&#148; shall mean:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="6%"></TD>
        <TD width="94%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A&nbsp; The acquisition in one or a series of
transactions by a Significant Holder, or any
Controlled or Controlling Affiliate thereof, of
shares of any class or series of Capital Stock
that has the effect of causing such Significant
Holder to increase its beneficial ownership to
seventy-five percent (75%) or more of the votes
entitled to be cast by the holders of all then
outstanding shares of Voting Stock; or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B&nbsp; any reclassification of securities
(including any reverse stock split), or
recapitalization of the Corporation (including
any stock repurchases by the Corporation), or
any merger or consolidation of the Corporation
with any of its Subsidiaries or any other
transaction (whether or not with or otherwise
involving a Significant Stockholder) that has
the effect, directly or indirectly, of
increasing the proportionate share of any class
or series of Capital Stock, or any securities
convertible into Capital Stock or into equity
securities of any Subsidiary,</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">8</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="6%"></TD>
        <TD width="94%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">that is beneficially owned by any
Significant Stockholder, such that after giving
effect to such reclassification,
recapitalization or other transaction, a
Significant Holder will beneficially own
seventy-five percent (75%) or more of the votes
entitled to be cast by the holders of all then
outstanding shares of Voting Stock.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;The term &#147;Related-Party Transaction&#148; shall mean:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="6%"></TD>
        <TD width="94%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A&nbsp; a liquidation or dissolution of the
Corporation that is voted for or consented to by
any Related Party, or any Controlled or
Controlling Affiliate thereof, that immediately
prior to such transaction beneficially owns more
than fifty percent (50%) of the votes entitled
to be cast by the holders of all then
outstanding shares of Voting Stock; or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B&nbsp; any sale of assets of the Corporation or
any material Subsidiary to, or any acquisition
of assets from or share subscription in, a
Related Party, or any Controlled or Controlling
Affiliate thereof, directly or indirectly and in
any transaction or series of related
transactions, the value of which in each case
exceeds $5&nbsp;million; or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C&nbsp; any merger, statutory share exchange or
consolidation involving the Corporation or any
Subsidiary, directly or indirectly and in any
transaction or series of related transactions,
the value of which in each case exceeds $5
million, with any Related Party or any
Controlled or Controlling Affiliate thereof; or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D&nbsp; any merger, statutory share exchange or
consolidation involving the Corporation or any
Subsidiary, directly or indirectly and in any
transaction or series of related transactions,
the value of which in each case exceeds $5
million and pursuant to which any Related Party,
or any Controlled or Controlling Affiliate
thereof, is entitled to receive consideration in
respect of its securities that is different in
form (including, as different in form, the
retention by some stockholders of their existing
securities, while other stockholders of the same
class are not so retaining their existing
securities) or amount from that offered to other
holders of the same class of securities
(excluding ancillary arrangements or rights
entailing no monetary payments other than for
reasonable third-party legal fees, out-of-pocket
expense reimbursement and indemnification for
the benefit of a Related Party or its</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">9</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="6%"></TD>
        <TD width="94%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">Controlled or Controlled Affiliates for
liabilities in respect of which other holders of
the same class have no liability); or</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>

<TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;E&nbsp; any other transaction or series of
related transactions, the value of which in each
case exceeds $5&nbsp;million, between or among the
Corporation and/or any Subsidiary, on the one
hand, and any Related Parties or any Controlled
or Controlling Affiliates thereof, on the other
hand (other than a subscription for shares of
the Corporation by any Related Party or any
Controlled or Controlling Affiliate thereof,
pursuant to a rights offering made available to
all holders of Common Stock on a pro rata basis
and for the same amount and form of
consideration and otherwise on substantially the
same terms and conditions).</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;The term &#147;Capital Stock&#148; shall mean all capital stock of
the Corporation authorized to be issued from time to time under
Article&nbsp;Fourth of this Certificate of Incorporation; and the term
&#147;Voting Stock&#148; shall mean all Capital Stock which by its terms may
be voted on all matters submitted to stockholders of the
Corporation generally.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;The term &#147;Significant Holder&#148; shall mean any person
(other than the Corporation or any Subsidiary and other than any
profit-sharing, employee stock ownership or other employee benefit
plan of the Corporation or any Subsidiary or any trustee of or
fiduciaries with respect to any such plan when acting in such
capacity) who, individually or as a member of a group within the
meaning of Rule&nbsp;13d-5 under the Act, is the beneficial owner of
Voting Stock representing twenty percent (20%) or more of the votes
entitled to be cast by the holders of all then outstanding shares
of Voting Stock;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;A person shall be a &#147;beneficial owner&#148; of any Capital
Stock (A)&nbsp;which such person or any of its Controlled or Controlling
Affiliates owns, directly or indirectly; (B)&nbsp;which such person or
any of its Controlled or Controlling Affiliates has, directly or
indirectly, (1)&nbsp;the right to acquire (whether such right is
exercisable immediately or subject only to the passage of time),
pursuant to any agreement, arrangement or understanding or upon the
exercise of conversation rights, exchange rights, warrants or
options or otherwise, or (2)&nbsp;the right to vote pursuant to any
agreement, arrangement or understanding; or (C)&nbsp;which are owned,
directly or indirectly, by any other person with which such person
or any of its Controlled or Controlling Affiliates has any
agreement, arrangement or understanding for the purpose of
acquiring, holding, voting or disposing of any shares of Capital
Stock. For the purposes of determining whether a person is a
Significant Holder pursuant to paragraph (c)(iv) of this Article
Twelfth or a Controlled or Controlling Affiliate pursuant to
paragraph (c)(vi) of this Article&nbsp;Twelfth, the number of shares of
Capital Stock deemed to be</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">10</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">outstanding shall include shares deemed beneficially owned by
such person through application of this paragraph (c)(v) of this
Article&nbsp;Twelfth, but shall not include any other shares of Capital
Stock that may be issuable pursuant to any agreement, arrangement
or understanding, or upon exercise of conversion rights, warrants
or options, or otherwise.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;The term &#147;Controlled or Controlling Affiliate&#148; shall mean
with respect to a specified person, a person that directly or
indirectly through one or more intermediaries, controls or is
controlled by, or is under common control with, the person
specified; provided that the Corporation and its Subsidiaries shall
not, and the executive officers or directors of the Corporation or
any of its Subsidiaries shall not, solely as a result of holding
such office, be deemed a &#147;Controlled or Controlling Affiliate&#148; of a
Significant Holder; and provided, further, that for purposes of
this definition, the term &#147;control&#148; (including the terms
&#147;controlling,&#148; &#147;controlled by&#148; and &#147;under common control with&#148;)
shall mean the possession direct or indirect, of the power to
direct or cause the direction of the management and policies of a
person through the ownership of more than fifty percent (50%) of
the voting securities of such person or the ability to otherwise
designate a majority of the board of directors or managers of such
person.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;The term &#147;Subsidiary&#148; means any company or other entity
of which a majority of any class of equity security is beneficially
owned by the Corporation; provided, however, that for the purposes
of the definition of Significant Holder set forth in paragraph
(c)(iv) of this Article&nbsp;Twelfth, the term &#147;Subsidiary&#148; shall mean
only a company of which a majority of each class of equity security
is beneficially owned by the Corporation.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)&nbsp;The term &#147;Five Percent Holder&#148; means any person (other
than the Corporation or any Subsidiary and other than any
profit-sharing, employee stock ownership or other employee benefit
plan of the Corporation or any Subsidiary or any trustee of or
fiduciaries with respect to any such plan when acting in such
capacity) who, as of the record date (if any) established for any
applicable transaction or vote (or if there is no record date, as
of the date of consummation of the transaction) and based on the
most recent reports or disclosures filed publicly under the Act,
individually or as a member of a group within the meaning of Rule
13d-5 under the Act, is the beneficial owner of Voting Stock
representing five percent (5%) or more of the votes entitled to be
cast by the holders of all then outstanding shares of Voting Stock;
provided that for purposes of this definition only, a person who
reports or discloses beneficial ownership as a member of a group or
by virtue of a relationship with other persons with respect to the
Voting Stock, shall not be deemed to beneficially own any shares of
Voting Stock held by persons beneficially owning Voting Stock
representing two percent (2%) or less of the votes entitled to be
cast by the holders of all then outstanding shares of Voting Stock
and any such person beneficially owning Voting Stock representing
two percent (2%) or less of the votes entitled to be cast by the
holders of all then outstanding shares of Voting</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">11</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">Stock shall not be deemed a Five Percent Holder or otherwise
be entitled to exercise any rights of a Five Percent Holder.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;The term &#147;Related Party&#148; means, in connection with any
Related Party Transaction, any person who at any time during the
eighteen (18)&nbsp;month period preceding such Related Party Transaction
constituted a Significant Holder.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;The term &#147;entire Board of Directors&#148; as used in this
Article&nbsp;Twelfth and in this Restated Certificate of Incorporation,
generally, means the total number of directors of the Corporation
then holding office and entitled to vote.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp; The Board of Directors shall for purposes of this Article&nbsp;Twelfth be
entitled to rely on information contained in the most recent disclosures filed
publicly under the Act as to (i)&nbsp;whether a person is a Significant Holder, (ii)
the number of shares of Capital Stock or other securities beneficially owned by
any person, and (iii)&nbsp;whether a person is a Controlled or Controlling Affiliate
of another. Any such decision made in good faith on such basis shall be
conclusive. Any persons deemed Significant Holders or Five Percent Holders
solely by virtue of being a member of a group or having a relationship with
other persons, which membership or relationship is described in disclosures
filed publicly under the Act, shall at the request of the Corporation, select
one designee to act on their behalf with respect to any rights or obligations
hereunder.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the corporation has caused this Restated Certificate
of Incorporation to be signed by Larry Enterline, its Chief Executive Officer,
this <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> day of <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, 2003.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="45%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="44%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" align="left" valign="top"><FONT size="2">PERSONNEL GROUP OF AMERICA, INC.</FONT></TD>
</TR>

<TR>
        <TD>&nbsp;<BR></TD>
</TR>
<TR>
        <TD>&nbsp;<BR></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
By:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Larry Enterline</FONT></TD>
</TR>
</TABLE>
</CENTER>

<P align="center"><FONT size="2">12</FONT>




<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<!-- link2 "Annex B" -->
<P align="right"><FONT size="2"><B>Annex B</B></FONT>

<P align="right"><FONT size="2"><B>Adopted May&nbsp;8, 2003</B></FONT>

<P align="center"><FONT size="2"><B>PERSONNEL GROUP OF AMERICA, INC.</B></FONT>

<P align="center"><FONT size="2"><B>AUDIT COMMITTEE OF THE BOARD OF DIRECTORS</B></FONT>

<P align="center"><FONT size="2"><B>CHARTER</B></FONT>

<P align="left"><FONT size="2"><B>I.&nbsp; PURPOSE AND RESPONSIBILITIES</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The primary purpose of the Audit Committee (the &#147;<U>Committee</U>&#148;) is to assist
the Board of Directors of Personnel Group of America, Inc., (the &#147;<U>Corporation</U>&#148;)
in fulfilling its oversight responsibilities by monitoring (i)&nbsp;the
Corporation&#146;s accounting, auditing, and financial reporting processes
generally, including the performance and independence of the independent
auditor, (ii)&nbsp;the Corporation&#146;s systems of internal controls regarding finance
and accounting and (iii)&nbsp;the Company&#146;s risk management and compliance with
legal and regulatory requirements. The Committee&#146;s primary responsibilities
are to:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Serve as an independent and objective party to monitor the
integrity of the Corporation&#146;s financial reporting process and
internal control system;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Review, oversee and appraise the qualifications, independence
and audit performance of the Corporation&#146;s independent accountants;
and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="1%" align="left" nowrap><FONT size="2">&#149;</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="92%"><FONT size="2">Provide an open avenue of communication among the independent
accountants, financial and senior management, the internal auditors
and the Board.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;While the Committee has the responsibilities and authority set forth in
this Charter, it is not the duty of the Committee to plan or conduct audits or
to determine that the Company&#146;s financial statements are complete and accurate
and are in accordance with generally accepted accounting principles. That is
the responsibility of management and the independent accountants.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The independent accountants are ultimately accountable to the Committee,
which has the ultimate authority and responsibility to select, evaluate and,
where appropriate, replace the independent accountants (or to nominate the
independent accountants to be proposed for shareholder approval). The
Committee has direct responsibility for the compensation and oversight of the
work of the independent accountants (including resolution of disagreements
between management and the independent accountants regarding financial
reporting) for the purpose of preparing or issuing an audit report or related
work. The independent accountants shall report directly to the Committee.
</FONT>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P align="left"><FONT size="2"><B>II. COMPOSITION</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee shall be comprised of three or more directors appointed by
the Board, each of whom in the judgment of the Board shall be an independent
director within the meaning of applicable regulations, including those of any
national securities exchange or market on which the Corporation&#146;s securities
are traded. All members of the Committee shall have a working familiarity with
basic finance and accounting practices, and at least one member of the
Committee shall be an &#147;audit committee financial expert&#148; as defined by the SEC.
Committee members may enhance their familiarity with finance and accounting by
participating in educational programs conducted by the Corporation or outside
consultant parties.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless a Chairman of the Committee is appointed by the Board, the members
of the Committee may designate a Chairman by majority vote of the full
Committee membership.
</FONT>
<P align="left"><FONT size="2"><B>III. MEETINGS</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee shall meet at least four times annually, or more frequently
as circumstances dictate. The Committee may ask members of management or
others to attend any meeting and provide information or advice as needed. As
part of its responsibility to foster open communication, the Committee should
meet at least annually with management, the internal auditors and the
independent accountants in separate executive sessions to discuss any matters
that the Committee or any of these groups believes should be discussed
privately.
</FONT>
<P align="left"><FONT size="2"><B>IV. ACTIVITIES</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To fulfill its responsibilities, the Committee shall:
</FONT>
<P align="left"><FONT size="2"><U>Review of Documents and Reports; Audit Committee Report</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review with management and the independent accountants (i)&nbsp;the
Corporation&#146;s annual and quarterly financial statements, (ii)&nbsp;any accompanying
certification, report, opinion, or review by the independent accountants and
(iii)&nbsp;prior to the filing of the Form&nbsp;10-K or 10-Q, as applicable, disclosures
to be made in Management&#146;s Discussion and Analysis of Financial Condition and
Results of Operations. With respect to annual financial statements, recommend
to the Board, based on this review, whether the financial statement should be
included in the<BR>
Form&nbsp;10-K.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review with management and the independent accountants each earnings
press release (including the use of &#147;pro forma,&#148; &#147;adjusted&#148; or other non-GAAP
financial measures and any other earnings guidance) prior to the issuance of
such release and the filing of the related Form&nbsp;10-Q, and review financial
information and earnings guidance provided to ratings agencies prior to any
ratings agency presentations. The Committee&#146;s review in this regard may be
general in nature (i.e., a discussion of the types of information to be
disclosed and the type of presentation to be made). The Chairman of the
Committee may represent the entire Committee for these purposes.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provide or approve a report for inclusion in the Corporation&#146;s proxy
statement for its annual meeting of shareholders, in accordance with applicable
rules and regulations, including
</FONT>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">those of the Securities and Exchange Commission, and approve any
disclosure to be included in the Corporation&#146;s annual report or proxy statement
that describes the Committee&#146;s composition and responsibilities and how they
were discharged.
</FONT>
<P align="left"><FONT size="2"><U>Internal Auditors</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consider, in consultation with the independent accountants and the
internal auditors, the audit scope and plan of the internal auditors.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consider and review with management and the internal auditors:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Significant findings during the year and management&#146;s responses
thereto.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Any difficulties encountered in the course of their audits,
including any restrictions on the scope of their work or access to
required information.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. Any changes required in the planned scope of their audit plan.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. The internal audit department budget and staffing.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2"><U>Independent Accountants</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Select the Corporation&#146;s independent accountants, considering
independence, qualifications and effectiveness, and approve the scope of the
proposed audit for each fiscal year and the fees and other compensation to be
paid to the independent accountants therefor.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Preapprove all auditing services and permitted non-audit services
(including the fees and terms thereof) to be performed for the Corporation by
its independent accountants, subject to such exceptions for non-audit services
as permitted by applicable laws and regulations. The Committee may when it
deems appropriate form and delegate this authority to subcommittees consisting
of one or more Committee members, including the authority to grant preapprovals
of audit and permitted non-audit services, <U>provided</U> that decisions of such
subcommittee to grant preapprovals shall be presented to the full Committee at
its next meeting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Evaluate, at least annually, the independence of the independent
accountants, including considering whether the provision of permitted non-audit
services is compatible with maintaining the accountants&#146; independence and
confirming any rotation of the audit team as required by applicable rules and
regulations, and taking into account the opinions of management and internal
auditors.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review the performance of the independent accountants, and recommend to
the Board any proposed change with respect to the independent accountants if
and when circumstances warrant.
</FONT>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Set policies governing the Corporation&#146;s hiring of employees or former
employees of the independent accountants who participated in any capacity in
the audit of the Corporation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Periodically consult with the independent accountants out of the
presence of management about internal controls and the completeness and
accuracy of the Corporation&#146;s financial statements.
</FONT>
<P align="left"><FONT size="2"><U>Financial Reporting Processes</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In consultation with the independent accountants, review the integrity
and adequacy of the Corporation&#146;s financial reporting processes, both internal
and external.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review periodically the effect of regulatory and accounting
initiatives and off-balance-sheet structures, if any, on the Corporation&#146;s
financial statements.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Discuss with the independent accountants their judgments about the
quality and appropriateness of the Corporation&#146;s accounting principles as
applied in its financial reporting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review and discuss quarterly reports from the independent accountants
on: (i)&nbsp;all critical accounting policies and practices of the Corporation;
(ii)&nbsp;all alternative treatments of financial information within generally
accepted accounting principles that have been discussed with management, the
ramifications of the use of such alternative disclosures and treatments, and
the treatment preferred by the independent accountants; and (iii)&nbsp;other
material written communications between the independent accountants and
management, such as any management letter or schedule of unadjusted
differences.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review and resolve any significant disagreement among management and
the independent accountants in connection with the preparation of the financial
statements, and consider with the independent accountants any other significant
findings and recommendations of those accountants, together with management&#146;s
responses thereto.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review disclosures made to the Committee by the Chief Executive
Officer and the Chief Financial Officer during their certification process for
Forms 10-K and Form&nbsp;10-Q about any significant deficiencies in the design or
operation of internal controls or material weaknesses therein and any fraud
involving management or other employees who have a significant role in the
Corporation&#146;s internal controls.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Consider, and approve if appropriate, any major changes to the
Corporation&#146;s auditing and accounting principles and practices suggested by the
independent accountants or management.
</FONT>
<P align="left"><FONT size="2"><U>Process Improvement</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Facilitate the reporting to the Committee by both management and the
independent accountants of any significant judgments (including, without
limitation, critical accounting policies and practices) made in management&#146;s
preparation of the financial statements
</FONT>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">and the view of both management and the accountants as to the
appropriateness of such judgments.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;After completion of the annual audit, review separately with both
management and the independent accountants any significant difficulties
encountered during the course of the audit, including any restrictions on the
scope of work or access to required information.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review with the independent accountants and management the extent to
which any changes or improvements in financial or accounting practices that
have been approved by the Committee have been implemented.
</FONT>
<P align="left"><FONT size="2"><U>Risk Management; Legal and Regulatory</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inquire of management, the internal auditors and the independent
accountants about significant risks or exposures, including those arising from
major legislative or regulatory developments, and assess the steps management
has taken to minimize such risks to the Corporation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review the status of compliance with laws and regulations, and the
scope and status of systems designed to promote the Corporation&#146;s compliance
with laws and regulations, through reports from management, legal counsel and,
if deemed appropriate, third parties.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Review periodically, with counsel, any legal matter that could have a
significant impact on the Corporation&#146;s financial statements.
</FONT>
<P align="left"><FONT size="2"><U>Miscellaneous</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Establish procedures for the receipt, retention and treatment of
complaints received by the Corporation regarding accounting, internal
accounting controls or auditing matters, and the confidential, anonymous
submission by employees of concerns regarding questionable accounting or
auditing matters.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Report Committee activities to the Board of Directors and make such
recommendations to the Board of Directors as the Committee deems appropriate.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepare for the Board an annual performance evaluation of the
Committee, and annually review and reassess the adequacy of this Charter
(recommending any appropriate changes to the Board).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In discharging its oversight role, the Committee is empowered to study or
investigate any matter of interest or concern that the Committee deems
appropriate and shall have the sole authority to retain outside counsel or
other experts for this purpose, including the authority to approve the fees
payable to such counsel or experts and any other terms of retention. The
Corporation shall provide appropriate funding to pay all such fees and for any
other activities undertaken by the Committee pursuant to this Charter.
</FONT>

<P align="center"><FONT size="2">&nbsp;</FONT>




<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<!-- link2 "Annex C" -->
<P align="right"><FONT size="2"><B>Annex C</B></FONT>

<P align="center"><FONT size="2"><B>2003 EQUITY INCENTIVE PLAN<BR>
OF<BR>
PERSONNEL GROUP OF AMERICA, INC.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Purpose</U>. The purpose of this Equity Incentive Plan is to advance the
interests of the Corporation by encouraging and enabling the acquisition of a
larger personal proprietary interest in the Corporation by employees and
directors of, and consultants to, the Corporation and its Subsidiaries upon
whose judgment and keen interest the Corporation is largely dependent for the
successful conduct of its operations and by providing such employees, directors
and consultants with incentives to put forth maximum efforts for the success of
the Corporation&#146;s business. It is anticipated that the acquisition of such
proprietary interest in the Corporation and such incentives will stimulate the
efforts of such employees, directors and consultants on behalf of the
Corporation and its Subsidiaries and strengthen their desire to remain with the
Corporation and its Subsidiaries. It is also expected that such incentives and
the opportunity to acquire such a proprietary interest will enable the
Corporation and its Subsidiaries to attract desirable employees and other
service providers.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Definitions</U>. When used in this Plan, unless the context otherwise
requires:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) &#147;Alternative Rights&#148; shall have the meaning set forth in Section
7.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) &#147;Board of Directors&#148; shall mean the Board of Directors of the
Corporation, as constituted at any time.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) &#147;Cause&#148; shall mean, with respect to the holder of an Incentive
Award, the following: (i)&nbsp;if the holder has an employment agreement in
effect with the Corporation or a Subsidiary which contains a definition
of cause, then the definition of the term &#147;Cause&#148; for purposes of the
Plan shall be as defined in such employment agreement, or (ii)&nbsp;if the
holder does not have an employment agreement in effect with the
Corporation or a Subsidiary which contains a definition of cause, then
&#147;Cause&#148; for purposes of the Plan shall be as determined by the Committee
in its sole discretion.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) &#147;Committee&#148; shall mean the Committee hereinafter described in
Section&nbsp;3.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) &#147;Corporation&#148; shall mean Personnel Group of America, Inc.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) &#147;Deferred Stock Award&#148; shall mean an Incentive Award granted in
accordance with Section&nbsp;13.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) &#147;Dividend Equivalent&#148; shall mean an Incentive Award granted in
accordance with Section&nbsp;15.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) &#147;Eligible Persons&#148; shall mean those persons described in Section
4 who are potential recipients of Incentive Awards.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) &#147;Exchange Act&#148; shall mean the Securities Exchange Act of 1934,
as amended.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) &#147;Fair Market Value&#148; on a specified date shall mean the average
of the highest and lowest selling price at which a Share is traded on the
stock exchange, if any, on which Shares are primarily traded or, if the
Shares are not then traded on a stock exchange, the average of the
closing representative bid and asked price of a Share as reported by
NASDAQ, but if no Shares were traded on such date, then on the last
previous date on which a Share was so traded, or, if none of the above
are applicable, the value of a Share as established by the Board of
Directors for such date using any reasonable method of valuation.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) &#147;Incentive Award&#148; shall mean an Option, Restricted Stock Award,
Rights, Deferred Stock Award, Performance Award, or Dividend Equivalent
granted pursuant to this Plan.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) &#147;Incentive Stock Option&#148; shall have the meaning set forth in
section 422 of the Internal Revenue Code.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) &#147;Internal Revenue Code&#148; shall mean the Internal Revenue Code of
1986, as amended.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) &#147;Options&#148; shall mean the stock options granted pursuant to this
Plan.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) &#147;Performance Award&#148; shall mean an Incentive Award granted in
accordance with Section&nbsp;14.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) &#147;Plan&#148; shall mean this 2003 Equity Incentive Plan of Personnel
Group of America, Inc., as adopted by the Board of Directors on
April&nbsp;14,
2003, as such Plan from time to time may be amended.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) &#147;Restricted Shares&#148; shall mean the Shares issued as a result of
a Restricted Stock Award.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) &#147;Restricted Stock Award&#148; shall mean a grant of Shares or of the
right to purchase Shares pursuant to Section&nbsp;12 hereof.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) &#147;Rights&#148; shall mean stock appreciation rights granted pursuant
to the Plan.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) &#147;Share&#148; shall mean a share of common stock of the Corporation.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) &#147;Spread&#148; shall mean (i)&nbsp;with respect to Alternative Rights, the
excess of the Fair Market Value of one Share on the date of exercise of
such Rights over the purchase price per Share payable under the related
Option and (ii)&nbsp;with respect to Rights not granted in connection with an
Option, the excess of the Fair Market Value of one Share on the date of
exercise of such Rights over the Fair Market Value of one Share on the
date such Rights were granted.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">2</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) &#147;Subsidiary&#148; shall mean any corporation 50% or more of whose
stock having general voting power is owned by the Corporation, or by
another Subsidiary as herein defined, of the Corporation.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Administration</U>. The Plan shall be administered by a Committee of the
Board of Directors which shall consist of two or more directors of the
Corporation, each of whom shall be a &#147;Non-Employee Director&#148; within the meaning
of Rule&nbsp;16b-3 under the Exchange Act and an &#147;outside director&#148; within the
meaning of Section&nbsp;162(m) of the Internal Revenue Code. Notwithstanding the
foregoing, if at any time the Corporation is not required to register any class
of its equity securities under Section&nbsp;12 of the Exchange Act, the Plan may be
administered by the Board of Directors during such time. During any period of
time in which the Plan is administered by the Board of Directors, all
references in the Plan to the Committee shall be deemed to refer to the Board
of Directors.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee shall have full power and authority to administer and
interpret the Plan. Determinations of the Committee as to any question which
may arise with respect to the interpretation of the provisions of the Plan and
Incentive Awards shall be final. The Committee may authorize and establish
such rules, regulations and revisions thereof not inconsistent with the
provisions of the Plan, as it may deem advisable to make the Plan and Incentive
Awards effective or provide for their administration, and may take such other
action with regard to the Plan and Incentive Awards as it shall deem desirable
to effectuate their purpose.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Participants</U>. Except as hereinafter provided, the class of persons who
are potential recipients of Incentive Awards granted under this Plan shall
consist of employees and directors of, and consultants to, the Corporation or a
Subsidiary, as determined by the Committee. The parties to whom Incentive
Awards are granted under this Plan, and the number of Shares subject to each
such Incentive Award, shall be determined by the Committee in its sole
discretion, subject, however, to the terms and conditions of this Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Shares</U>. Subject to the provisions of Section&nbsp;19 hereof, the Committee
may grant Incentive Awards with respect to an aggregate of up to 19,870,873
Shares, all of which Shares may be either Shares held in treasury or authorized
but unissued Shares; provided, however, that the foregoing limitation shall not
apply to Alternative Rights but shall apply to the Option with respect to which
the Alternative Rights are granted, and shall not apply to any Dividend
Equivalents but shall apply to the Incentive Award with respect to which such
Dividend Equivalents are granted. The maximum number of Shares which may be
the subject of Options and Rights granted during any calendar year to any
individual shall not exceed 5,750,000 Shares. If the Shares that would be
issued or transferred pursuant to any Incentive Awards are not issued or
transferred and cease to be issuable or transferable for any reason, or if
Restricted Shares which are subject to a Restricted Stock Award are forfeited,
the number of Shares subject to such Incentive Award will no longer be charged
against the limitation provided for herein and may again be made subject to
Incentive Awards; provided, however, that Shares as to which an Option has been
surrendered in connection with the exercise of an Alternative Right shall not
again be available for the grant of any further Incentive Awards.
Notwithstanding the preceding, with respect to any Option and/or any Rights
granted to any individual who is a &#147;covered employee&#148; within the meaning of
Section&nbsp;162(m) of the Internal Revenue Code that is canceled, the number of
shares subject to such Option and/or Rights shall continue to count against the
</FONT>
<P align="center"><FONT size="2">3</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">maximum number of shares which may be the subject of Options and Rights
granted to such individual. For purposes of the preceding sentence, if, after
grant, the exercise price of an Option and/or the base amount of any Rights is
reduced, such reduction shall be treated as a cancellation of such Option
and/or Rights and the grant of a new Option and/or Rights (if any), and both
the cancellation of the Option and/or Rights and the new Option and/or Rights
shall reduce the maximum number of shares for which Options and Rights may be
granted to the holder of such Option and/or Rights.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Grant of Options</U>. The number of Options to be granted to any Eligible
Person shall be determined by the Committee in its sole discretion. At the
time an Option is granted, the Committee may, in its sole discretion, designate
whether such Option (a)&nbsp;is to be considered as an Incentive Stock Option, or
(b)&nbsp;is not to be treated as an Incentive Stock Option for purposes of this Plan
and the Internal Revenue Code. No Option which is intended to qualify as an
Incentive Stock Option shall be granted under this Plan to any individual who,
at the time of such grant, is not an employee of the Corporation or a
Subsidiary.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding any other provision of this Plan to the contrary, to the
extent that the aggregate Fair Market Value (determined as of the date an
Option is granted) of the Shares with respect to which Options which are
designated as (or deemed to be) Incentive Stock Options granted to an employee
(and any incentive stock options granted to such employee under any other stock
option plan maintained by the Corporation or any Subsidiary that meets the
requirements of Section&nbsp;422 of the Internal Revenue Code) first become
exercisable in any calendar year exceeds $100,000, such Options shall be
treated as Options which are not Incentive Stock Options. Options with respect
to which no designation is made by the Committee shall be deemed to be
Incentive Stock Options to the extent that the $100,000 limitation described in
the preceding sentence is met. This paragraph shall be applied by taking
options into account in the order in which they are granted.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nothing herein contained shall be construed to prohibit the issuance of
Options at different times to the same person.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;An Option shall be evidenced by an agreement executed on behalf of the
Corporation and by the Eligible Person to whom the Option is granted. The form
of Option agreement shall be determined from time to time by the Committee, and
need not be identical with respect to each grantee. The Option agreement shall
indicate whether or not the Option is an Incentive Stock Option.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Grant of Rights</U>. The Committee shall have the authority to grant to
any Eligible Person, in its sole discretion, Rights which may be granted
separately, or in connection with an Option at the time of the grant of an
Option. Any Rights granted in connection with an Option (&#147;Alternative Rights&#148;)
shall be granted with respect to the same number of Shares as are covered by
the Option, subject to adjustment pursuant to the provisions of Section&nbsp;19
hereof, and may be exercised as an alternative to the exercise of the related
Option.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Alternative Rights granted in connection with an Option shall entitle the
holder thereof to receive payment from the Corporation, determined as
hereinafter provided, only if and to the extent that the related Option is
exercisable, by surrendering the Option with respect to the
</FONT>
<P align="center"><FONT size="2">4</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">number of Shares as to which such Rights are then exercised. Such Option,
to the extent surrendered, shall be deemed exercised for purposes of the
limitations under Section&nbsp;5. Upon any exercise of Alternative Rights, the
holder thereof shall be entitled to receive payment of an amount equal to the
product obtained by multiplying (i)&nbsp;the Spread, or a portion of the Spread
determined by the Committee at the time of grant, by (ii)&nbsp;the number of Shares
in respect of which the Rights shall have then been so exercised.
Notwithstanding anything contained herein, Alternative Rights granted in
connection with an Option that is an Incentive Stock Option may not be
exercised at any time when the Fair Market Value of the Shares subject thereto
is less than the exercise price of such Option.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Rights granted without relationship to an Option shall be exercisable for
a duration determined by the Committee, but in no event more than ten years
from the date of grant. Such Rights shall entitle the holder, upon the
exercise thereof, to receive payment from the Corporation of an amount equal to
the product obtained by multiplying (i)&nbsp;the Spread, or a portion of the Spread
determined by the Committee at the time of grant, by (ii)&nbsp;the number of Shares
in respect of which the Rights shall have then been so exercised.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding anything contained herein, the Committee may, in its sole
discretion, limit the amount payable upon the exercise of Rights. Any such
limitation shall be determined as of the date of grant and noted on the
certificate evidencing the grant of the Rights.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment of the amount determined hereunder upon the exercise of Rights may
be made solely in cash, or solely in Shares valued at their Fair Market Value
on the date of exercise of Rights, or in a combination of cash and Shares, as
determined by the Committee. No fractional Shares shall be issued by the
Corporation, and settlement therefor shall be made in cash.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Rights shall be evidenced by an agreement executed on behalf of the
Corporation and by the Eligible Person to whom the Rights are granted. The
form of Rights agreement shall be as determined from time to time by the
Committee, and need not be identical with respect to each grantee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Purchase Price Under Options and Restricted Stock</U>. The price per Share
of the Shares to be purchased pursuant to the exercise of any Option shall be
fixed by the Committee at the time of grant; provided, however, that the
purchase price per Share for the Shares to be purchased pursuant to the
exercise of an Incentive Stock Option shall not be less than the Fair Market
Value of a Share on the day on which the Option is granted.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purchase price per Share for Restricted Shares to be purchased
pursuant to Restricted Stock Awards shall be fixed by the Committee at the time
of the grant of the Restricted Stock Award; provided, however, that such
purchase price shall not be less than the par value of such Shares. Payment of
such purchase price shall be made in cash or by check payable to the order of
the Corporation, or by such other method as the Committee may permit.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Duration of Options and Related Rights</U>. The duration of any Option
granted under this Plan shall be fixed by the Committee at the time of grant;
provided, however, that no Option shall remain in effect for a period of more
than ten years from the date upon which the
</FONT>
<P align="center"><FONT size="2">5</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">Option is granted. The duration of any Rights granted in connection with
any Option shall be coterminous with the duration of the related Option.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Ten Percent Stockholders</U>. Notwithstanding any other provision of this
Plan to the contrary, no Option which is intended to qualify as an Incentive
Stock Option may be granted under this Plan to any employee who, at the time
the Option is granted, owns shares possessing more than 10&nbsp;percent of the total
combined voting power or value of all classes of stock of the Corporation,
unless the exercise price under such Option is at least 110% of the Fair Market
Value of a Share on the date such Option is granted and the duration of such
Option is no more than five years.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Exercise of Options and Rights</U>. Except as otherwise provided herein,
or as otherwise determined by the Committee and provided in an applicable
Option or Rights agreement, or as otherwise provided in the holder&#146;s employment
agreement (if any) with the Corporation or a Subsidiary, Options and Rights,
after the grant thereof, shall become vested and exercisable by the holder
cumulatively each month pro rata at an annual rate of 25%, beginning on the
last day of the first month that begins after the date of grant, provided that the holder is still in the
employ or service of the Corporation or a Subsidiary on the applicable
vesting date.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding the foregoing, all or any part of any remaining
unexercised Options or Rights granted to any person may be exercised upon the
occurrence of such special circumstance or event as in the opinion of the
Committee merits special consideration, and the Committee may, in its sole
discretion, require that any exercise of an Option or Right on an accelerated
basis pursuant hereto be contingent upon the consummation of the applicable
event giving rise to such acceleration.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;An Option shall be exercised by the delivery of a written notice duly
signed by the holder thereof to such effect, together with the Option agreement
and the full purchase price of the Shares purchased pursuant to the exercise of
the Option, to the Chairman of the Board of Directors or an officer of the
Corporation appointed by the Chairman of the Board of Directors for the purpose
of receiving the same. Payment of the full purchase price shall be made as
follows: in cash or by check payable to the order of the Corporation; by
delivery to the Corporation of Shares which shall be valued at their Fair
Market Value on the date of exercise of the Option (provided, that a holder may
not use any Shares to pay the purchase price unless the holder has beneficially
owned such Shares for at least six months); or by such other methods as the
Committee may permit from time to time.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Within a reasonable time after the exercise of an Option, the Corporation
shall cause to be delivered to the person entitled thereto, a certificate for
the Shares purchased pursuant to the exercise of the Option. If the Option
shall have been exercised with respect to less than all of the Shares subject
to the Option, the Corporation shall also cause to be delivered to the person
entitled thereto a new Option agreement in replacement of the agreement
surrendered at the time of the exercise of the Option, indicating the number of
Shares with respect to which the Option remains available for exercise, or the
original Option agreement shall be endorsed to give effect to the partial
exercise thereof.
</FONT>
<P align="center"><FONT size="2">6</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Alternative Rights or Rights not granted in connection with an Option
shall be exercised by the delivery of a duly signed notice in writing to such
effect, together with the Rights agreement. Holders of Alternative Rights
shall also surrender the related Option agreement. Within a reasonable time
thereafter, the Corporation shall cause to be delivered to the person entitled
thereto, the amount of cash and/or a certificate for the number of Shares
determined in accordance with Section&nbsp;7 hereof. Upon the exercise of
Alternative Rights, the number of Shares subject to exercise under the related
Option or portion thereof shall be reduced by the number of Shares represented
by the Option or portion thereof surrendered. Shares subject to Options or
portions thereof surrendered upon the exercise of Alternative Rights shall not
be available for subsequent Incentive Awards under the Plan. If the Rights
shall have been exercised with respect to less than all of the Shares subject
thereto (or to the related Option, if any), the Corporation shall also cause to
be delivered to the person entitled thereto a Rights agreement (and an Option
agreement, in the case of Alternative Rights) with respect to the difference
between the number of Shares under the Rights agreement (and related Option
agreement, if any) surrendered at the time of the exercise of the Rights and
the number of Shares with respect to which the Rights were so exercised (and
the related Option, if any, was so surrendered), or the original Rights
agreement (and related Option agreement, if any) shall be endorsed to give
effect to the partial exercise (and surrender) thereof.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding any other provision of the Plan or of any Option or
Rights, no Option or Rights granted pursuant to the Plan may be exercised at
any time when the Option or Rights or the granting or exercise thereof violates
any law or governmental order or regulation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Terms and Conditions of Restricted Stock Awards</U>. The Committee shall
have the authority to grant to any Eligible Person a Restricted Stock Award,
subject to the following terms and conditions:
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp; All Restricted Shares granted to or purchased by an Eligible Person
pursuant to the Plan shall be subject to the following conditions:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;the Restricted Shares shall be subject to such transfer
restrictions and risk of forfeiture as the Committee shall determine at
the time the Restricted Stock Award is granted, until such specific
conditions are met (which conditions may be based on continuing
employment or achievement of pre-established performance objectives, or
both);</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;the Restricted Shares may not be sold, transferred, or
otherwise alienated or hypothecated until the restrictions are satisfied,
removed or expire;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;each certificate representing Restricted Shares issued
pursuant to a Restricted Stock Award under this Plan shall bear a legend
making appropriate reference to the restrictions imposed; and</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;the Committee may impose such other conditions as it may deem
advisable on any Restricted Shares granted to or purchased by an Eligible
Person pursuant to a Restricted Stock Award under this Plan, including,
without limitation, restrictions under the requirements of any stock
exchange upon which such Shares or</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">7</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>




<P><FONT size="2">shares of the same class are then listed, and under any securities
law applicable to such Shares.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; The restrictions imposed under subsection (a)&nbsp;hereof upon Restricted
Shares shall lapse in accordance with a schedule or such other conditions as
shall be determined by the Committee, subject to the provisions of Section&nbsp;18
hereof.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp; Prior to the satisfaction, expiration or lapse of all of the
restrictions and conditions imposed upon Restricted Shares, a stock certificate
or certificates representing such Restricted Shares shall be registered in the
holder&#146;s name but shall be retained by the Corporation for the holder&#146;s
account. The holder shall have the right to vote such Restricted Shares and
shall have all other rights and privileges of a beneficial and record owner
with respect thereto, including, without limitation, the right to receive
dividends, distributions and adjustments with respect thereto; provided,
however, that such dividends, distributions and adjustments shall be retained
by the Corporation for the holder&#146;s account and for delivery to the holder,
together with the stock certificate or certificates representing such
Restricted Shares, as and when said restrictions and conditions shall have been
satisfied, expired or lapsed.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp; A Restricted Stock Award shall be evidenced by an agreement executed
on behalf of the Corporation and by the Eligible Person to whom the Restricted
Stock Award is granted. The form of Restricted Stock Award agreement shall be
determined from time to time by the Committee, and need not be identical with
respect to each grantee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Deferred Stock Awards</U>. The Committee shall have the authority to
grant to any Eligible Person a Deferred Stock Award, subject to the following
terms and conditions:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;Delivery of, and the issuance of certificates representing,
Shares issuable pursuant to a Deferred Stock Award shall occur upon
expiration of the deferral period specified by the Committee;</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;Deferred Stock Awards shall be subject to such restrictions as
the Committee may impose, which restrictions may lapse at the expiration
of the deferral period or at earlier specified times, separately or in
combination, in installments, or otherwise, as the Committee may
determine; and</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="3%"></TD>
        <TD width="97%"></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;A Deferred Stock Award shall be evidenced by an agreement
executed on behalf of the Corporation and by the Eligible Person to whom
the Deferred Stock Award is granted. The form of Deferred Stock Award
agreement shall be determined from time to time by the Committee, and
need not be identical with respect to each grantee.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Performance Awards</U>. The Committee shall have the authority to grant
to any Eligible Person a Performance Award, subject to such terms and
conditions as shall be determined by the Committee. The value of a Performance
Award may be linked to the market value, book value, net profits or other
measure of the value of a Share, or other specific performance criteria
determined appropriate by the Committee, in each case on a specified date or
dates or over any period or periods determined by the Committee, or may be
based upon the appreciation in the market value, book value, net profits or
other measure of the value of a
</FONT>
<P align="center"><FONT size="2">8</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">specified number of Shares over a fixed period or periods determined by
the Committee. In making such determinations, the Committee shall consider
(among such other factors as it deems relevant in light of the specific type of
award) the contributions, responsibilities and other compensation of the
particular Eligible Person. A Performance Award shall be evidenced by an
agreement executed on behalf of the Corporation and by the Eligible Person to
whom the Performance Award is granted. The form of Performance Award agreement
shall be determined from time to time by the Committee, and need not be
identical with respect to each grantee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Dividend Equivalents</U>. The Committee may grant Dividend Equivalents to
any Eligible Person who has been granted an Option, Rights, a Deferred Stock
Award or a Performance Award, subject to such terms and conditions as shall be
determined by the Committee. Such Dividend Equivalents shall be granted with
respect to the same number of Shares subject to the related Option, Rights,
Deferred Stock Award or Performance Award and shall be based on the dividends
declared on such number of Shares, to be credited as of dividend record dates
(subject to payment), during the period between the date the Option, Rights,
Deferred Stock Award or Performance Award is granted, and the date such Option,
Rights, Deferred Stock Award or Performance Award is exercised, vests or
expires, as determined by the Committee. Such Dividend Equivalents shall
represent the right to receive cash or additional Shares in accordance with
such formula and at such time and subject to such limitations as may be
determined by the Committee. Dividend Equivalents, if granted, shall be
reflected in the related Option, Rights, Deferred Stock Award or Performance
Award agreement.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Consideration for Incentive Awards</U>. The Corporation shall obtain such
consideration for the grant of an Incentive Award as the Committee in its
discretion may determine.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Restrictions on Transferability of Incentive Awards</U>. An Incentive
Award shall not be transferable otherwise than by will or the laws of descent
and distribution or as provided in this Section&nbsp;17. Notwithstanding the
preceding, the Committee may, in its discretion and subject to such terms and
conditions as the Committee shall approve, authorize a transfer of any Option,
other than an Option which is an Incentive Stock Option, by the initial holder
to (i)&nbsp;the spouse, children, step children, grandchildren or other family
members of the initial holder (&#147;Family Members&#148;), (ii)&nbsp;a trust or trusts for
the exclusive benefit of such Family Members, (iii)&nbsp;a corporation or
partnership in which such Family Members and the initial holder are the only
shareholders or partners, or (iv)&nbsp;such other estate planning persons or
entities which the Committee may permit; provided, however, that subsequent
transfers of such Option shall be prohibited except by will or the laws of
descent and distribution. Following any transfer of such an Option, such
Option shall continue to be subject to the same terms and conditions of the
Option and of the Plan. An Option which is intended to be an Incentive Stock
Option shall not be transferable otherwise than by will or the laws of descent
and distribution and shall be exercisable during the holder&#146;s lifetime only by
the holder thereof.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Termination of Employment or Service</U>. All or any part of any Option
and/or Rights, to the extent unexercised, shall terminate immediately, upon the
cessation or termination for any reason of the holder&#146;s employment by, or
service as a director of or consultant to, the Corporation or any Subsidiary,
except that the holder shall have three months following the cessation of his
employment or service with the Corporation or its Subsidiaries, and no longer,
</FONT>
<P align="center"><FONT size="2">9</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">within which to exercise any unexercised Option and/or Rights that he
could have exercised on the day on which such employment or service terminated;
provided, that such exercise must be accomplished prior to the expiration of
the term of such Option and Rights. Notwithstanding the foregoing, if the
cessation of employment or service is due to disability (to an extent and in a
manner as shall be determined in each case by the Committee in its sole
discretion) or to death, the holder or the representative of the Estate or the
heirs of a deceased holder shall have the privilege of exercising the Options
and Rights which are vested but unexercised at the time of such disability or
death; provided, however, that such exercise must be accomplished prior to the
expiration of the term of such Option and Rights and within one year of the
holder&#146;s disability or death, as the case may be. The Committee may, in its
sole discretion, extend the post-termination exercise period under this Section
18 with respect to any Option or Rights, but in no event beyond the expiration
of the term of such Option or Rights. If the employment or service of any
holder of an Option or Rights with the Corporation or a Subsidiary shall be
terminated for Cause, all unexercised Options and Rights of such holder shall
terminate immediately upon such termination of the holder&#146;s employment or
service with the Corporation and all Subsidiaries, and a holder of Options or
Rights whose employment or service with the Corporation and Subsidiaries is so
terminated, shall have no right after such termination to exercise any
unexercised Option or Rights he might have exercised prior to the termination
of his employment or service with the Corporation and Subsidiaries.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except as hereinafter provided, if a holder of a Restricted Stock Award or
Deferred Stock Award shall voluntarily or involuntarily leave the employ or
service of the Corporation or any Subsidiary, then (i)&nbsp;all Restricted Shares
subject to restrictions at the time his employment terminates (and any
dividends, distributions and adjustments retained by the Corporation with
respect thereto), and (ii)&nbsp;any Shares subject to a Deferred Stock Award with
respect to which the deferral period has not expired, shall be forfeited and
any consideration received therefor from the holder shall be returned to the
holder. Notwithstanding the foregoing, all restrictions to which Restricted
Stock Awards are subject shall lapse, and the deferral period under a Deferred
Stock Award shall expire, upon the occurrence of such special circumstance or
event as in the opinion of the Committee merits special consideration.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The consequence of a termination of employment or service with respect to
the holder of a Performance Award or Dividend Equivalents shall be as
determined by the Committee at the time of grant of any such Incentive Award,
subject, however, to any determination by the Committee upon the occurrence of
such special circumstance or event as in the opinion of the Committee merits
special consideration.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Adjustment Provision</U>. If, prior to the complete exercise of any
Option, or prior to the satisfaction, expiration or lapse of all of the
restrictions and conditions imposed pursuant to a Restricted Stock Award or
Deferred Stock Award, there shall be declared and paid a stock dividend upon
the Shares or if the Shares shall be split up, converted, exchanged,
reclassified, or in any way substituted for,
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp; in the case of an Option, then the Option, to the extent that it has
not been exercised, shall entitle the holder thereof upon the future exercise
of the Option to such number and kind of securities or cash or other property
subject to the terms of the Option to which he would have been entitled had he
actually owned the Shares subject to the unexercised portion of
</FONT>
<P align="center"><FONT size="2">10</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">the Option at the time of the occurrence of such stock dividend, split-up,
conversion, exchange, reclassification or substitution, and the aggregate
purchase price upon the future exercise of the Option shall be the same as if
the originally optioned Shares were being purchased thereunder;
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp; in the case of a Restricted Share issued pursuant to a Restricted
Stock Award, the holder of such Award shall receive, subject to the same
restrictions and other conditions of such Award as determined pursuant to the
provisions of Section&nbsp;12, the same securities or other property as are received
by the holders of the Corporation&#146;s Shares pursuant to such stock dividend,
split-up, conversion, exchange, reclassification or substitution; and
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp; in the case of a Deferred Stock Award, the holder shall receive, at
such time as would otherwise apply under such Award, such number and kind of
securities or cash or other property to which he would have been entitled had
he actually owned the Shares subject to the Deferred Stock Award at the time of
the occurrence of such stock dividend, split-up, conversion, exchange,
reclassification or substitution.
</FONT>
<P><FONT size="2">Any fractional shares or securities issuable as a result of such adjustment
shall be payable in cash based upon the Fair Market Value of such shares or
securities at the time such shares or securities would have otherwise been
issued. If any such event should occur, the number of Shares with respect to
which Incentive Awards remain to be issued, or with respect to which Incentive
Awards may be reissued, shall be adjusted in a similar manner.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition to the adjustments provided for in the preceding paragraph,
upon the occurrence of any of the events referred to in said paragraph prior to
the complete exercise of any Rights or the complete payment of any Dividend
Equivalents or payments pursuant to a Performance Award, the Committee, in its
sole discretion, shall determine the amount of cash and/or number of Shares or
other property to which the holder of the Rights shall be entitled upon their
exercise, or which shall be paid to the holder of Dividend Equivalents or a
Performance Award at such time as payment would otherwise be made, so that
there shall be no increase or dilution in the cash and/or value of the Shares
or other property to which the holder shall be entitled by reason of such
events.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding the foregoing, upon the dissolution or liquidation of the
Corporation, or the occurrence of a merger or consolidation in which the
Corporation is not the surviving corporation, or a merger or consolidation in
which the Corporation becomes a subsidiary of another corporation or a merger
or consolidation in which the voting securities of the Corporation outstanding
immediately prior thereto do not continue to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 50% of the combined voting securities of the Corporation or
such surviving entity immediately after such merger or consolidation, or upon a
spin-off (including a reverse spin-off) by the Corporation, but only as to the
holders of Incentive Awards who are to be employed immediately after the
spin-off by the entity which represents less than 50% of the value of the
Corporation immediately prior to the transaction and any holders who will serve
as directors of or consultants to such entity and not the Corporation, or upon
the sale of all or substantially all of the assets of the Corporation, the
outstanding Options, Rights, Deferred Stock Awards, Performance Awards and
Dividend Equivalents granted hereunder shall terminate upon the consummation of
such transaction, unless provision is made by the Corporation in connection
</FONT>
<P align="center"><FONT size="2">11</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">with such transaction for the assumption of Options, Rights, Deferred
Stock Awards, Performance Awards and Dividend Equivalents theretofore granted,
or the substitution for such Options, Rights, Deferred Stock Awards,
Performance Awards and Dividend Equivalents of new options of, and rights,
deferred stock awards, performance awards and dividend equivalents with respect
to, the successor corporation or a parent or subsidiary thereof, with
appropriate adjustments as to the number and kinds of shares and the per share
exercise prices. In the event the Options terminate as aforesaid in connection
with such a dissolution, liquidation, merger, consolidation, spin-off or sale,
the Committee shall provide that the holder of any such Option, to the extent
then vested, shall be entitled to receive from the Corporation an amount equal
to the excess of (i)&nbsp;the Fair Market Value (determined on the basis of the
amount received by shareholders in connection with such transaction) of the
Shares subject to the vested portion of the Option not theretofore exercised,
over (ii)&nbsp;the aggregate purchase price which would be payable for such Shares
upon the exercise of the Option. In the event Rights granted independently of
an Option terminate as aforesaid in connection with such a dissolution,
liquidation, merger, consolidation, spin-off or sale, the Committee shall
provide that the holder of any such Rights, to the extent then vested, shall be
entitled to receive from the Corporation an amount equal to the excess of (i)
the Fair Market Value (determined on the basis of the amount received by
shareholders in connection with such transaction) of the Shares subject to the
vested portion of the Rights not theretofore exercised, over (ii)&nbsp;the Fair
Market Value of such Shares on the date such Rights were granted (or a portion
of such excess equal to the portion of the Spread to which the holder is
entitled under the terms of such Rights). In the event a Deferred Stock Award,
Performance Award or Dividend Equivalent terminates as aforesaid in connection
with such a dissolution, liquidation, merger, consolidation, spin-off or sale,
the treatment of such Incentive Award shall be as provided in the agreement
evidencing such Incentive Award. Any amount payable by the Corporation
pursuant to this paragraph may be paid in the form of cash or Shares (or other
securities received by shareholders in connection with the applicable
transaction) as determined by the Committee in its sole discretion. In the
event of any other change in the corporate structure or outstanding Shares, the
Committee may, in its sole discretion, make such equitable adjustments to the
number of Shares and the class of shares available hereunder or to any
outstanding Incentive Awards as it shall deem appropriate to prevent dilution
or enlargement of rights.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Issuance
of Shares and Compliance with Securities Act</U>. The
Corporation may postpone the issuance and delivery of Shares pursuant to the
grant or exercise of any Incentive Award until (a)&nbsp;the admission of such Shares
to listing on any stock exchange on which Shares of the Corporation of the same
class are then listed, and (b)&nbsp;the completion of such registration or other
qualification of such Shares under any State or Federal law, rule or regulation
as the Corporation shall determine to be necessary or advisable. Any holder of
an Incentive Award shall make such representations and furnish such information
as may, in the opinion of counsel for the Corporation, be appropriate to permit
the Corporation, in the light of the then existence or non-existence with
respect to such Shares of an effective Registration Statement under the
Securities Act of 1933, as from time to time amended (the &#147;Securities Act&#148;), to
issue the Shares in compliance with the provisions of the Securities Act or any
comparable act. The Corporation shall have the right, in its sole discretion,
to legend any Shares which may be issued pursuant to the grant or exercise of
any Incentive Award, or may issue stop transfer orders in respect thereof.
</FONT>
<P align="center"><FONT size="2">12</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Income Tax Withholding</U>. If the Corporation or a Subsidiary shall be
required to withhold any amounts by reason of any Federal, State, local or
foreign tax rules or regulations in respect of any Incentive Award, the
Corporation or the Subsidiary shall be entitled to take such action as it deems
appropriate in order to ensure compliance with such withholding requirements.
In order to facilitate payment by the holder of an Incentive Award of his
withholding obligations with respect to the Incentive Award, the Corporation or
Subsidiary may, at its election, (a)&nbsp;deduct from any cash payment otherwise due
to the holder, the appropriate withholding amount, (b)&nbsp;require the holder to
pay to the Corporation or Subsidiary in cash the appropriate withholding
amount, (c)&nbsp;permit the holder to elect to have the Corporation withhold a
portion of the Shares otherwise to be delivered with respect to such Incentive
Award, the Fair Market Value of which is equal to the minimum statutory
withholding amount, or (d)&nbsp;permit the holder to elect to deliver to the
Corporation Shares already owned by the holder for at least six months, the
Fair Market Value of which is equal to the appropriate withholding amount.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Amendment of the Plan</U>. Except as hereinafter provided, the Board of
Directors or the Committee may at any time withdraw or from time to time amend
the Plan as it relates to, and the terms and conditions of, any Incentive
Awards not theretofore granted, and the Board of Directors or the Committee,
with the consent of the affected holder of an Incentive Award, may at any time
withdraw or from time to time amend the Plan as it relates to, and the terms
and conditions of, any outstanding Incentive Award. Notwithstanding the
foregoing, any amendment by the Board of Directors or the Committee which would
increase the number of Shares issuable under the Plan or with respect to
Options and Rights granted to any individual during any calendar year or change
the class of Eligible Persons shall be subject to the approval of the
shareholders of the Corporation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No Right of Employment or Service</U>. Nothing contained herein or in an
Incentive Award shall be construed to confer on any employee, director or
consultant any right to be continued in the employ of the Corporation or any
Subsidiary or as a director of, or consultant to, the Corporation or a
Subsidiary or derogate from any right of the Corporation and any Subsidiary to
retire, request the resignation of, discharge or cease its consulting
arrangement with such employee, director or consultant (without or with pay),
at any time, with or without cause.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Effective Date of the Plan</U>. This Plan is conditional upon its
approval by the shareholders of the Corporation in accordance with Sections&nbsp;422
and 162(m) of the Internal Revenue Code, and no Incentive Awards may be granted
prior to the date of such approval. If such approval is not obtained, then the
Plan shall be void and of no force or effect.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Final Grant Date</U>. No Incentive Award shall be granted under the Plan
after April&nbsp;13, 2013.
</FONT>

<P align="center"><FONT size="2">13</FONT>




<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="left" valign="top"><FONT size="2"><B>PROXY</B></FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2">
<B>PERSONNEL GROUP OF AMERICA, INC</B>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="right" valign="top"><FONT size="2"><B>PROXY</B></FONT></TD>
</TR>
</TABLE>
</CENTER>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2"><B>Proxy for the Annual Meeting of Stockholders to be Held on July __, 2003</B></FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center"><FONT size="2"><B>THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF<BR>
PERSONNEL GROUP OF AMERICA, INC.</B>
</FONT>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned hereby appoint(s) Larry L. Enterline, James C. Hunt and
Ken R. Bramlett, Jr., and each or any one of them, as Proxies, each with the
power to appoint his substitute, and hereby authorizes each of them to
represent and vote, as designated below, all shares of common stock of
Personnel Group of America, Inc. held of record by the undersigned on June&nbsp;20,
2003, and all shares of Series&nbsp;B preferred stock of Personnel Group of America,
Inc. held of record by the undersigned on June&nbsp;20, 2003, at our 2003 annual
meeting of stockholders to be held at the Wyndham Garden Hotel, 2600 Yorkmont
Road, Charlotte, North Carolina 28208 on Wednesday, July ___, 2003 at 9:30 a.m.,
local time, and at any adjournment thereof.
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="95%">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD valign="top"><FONT size="2"><FONT face="wingdings">&#120;</FONT></FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
<B>Please mark your</B></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
<B>vote as in this example</B></FONT></TD>
</TR>
</TABLE>
</CENTER>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="68%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="bottom"><FONT size="2">FOR
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">WITHHOLD<BR>
AUTHORITY</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">1.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
A proposal to elect each of the following as a
director, to serve until his successor is duly
elected and qualified:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Victor E. Mandel
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
James V. Napier
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
William J. Simione, Jr.
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">FOR
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">AGAINST
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">ABSTAIN</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">2.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
A proposal to approve and adopt the 2003 Equity Incentive Plan of
Personnel Group of America, Inc.;
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2"><B>&nbsp;</B></FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR>
        <TD align="left"><FONT size="1">

</FONT><BR></TD>
</TR>
<TR valign="bottom">
    <TD colspan="3" align="left" valign="top"><FONT size="2">
<B><U>Proposals to amend our certificate of incorporation to:</U></B></FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">3.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Effect a 1-for-25 reverse stock split
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">4.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Eliminate classification of the board of directors
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">5.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Permit stockholder action without a meeting
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">6.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Opt out from Delaware General Corporation Law Section&nbsp;203
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">7.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Require disinterested stockholder approval of certain
transactions with 20% stockholders
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">8.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Require approval by 5% stockholders and 80% of directors for
transactions involving 20% stockholders
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">9.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Require supermajority vote for charter and bylaw amendments
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>
</TABLE>
</CENTER>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P align="center"><FONT size="2">&nbsp;</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="68%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">FOR
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">AGAINST
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">ABSTAIN</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">10.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Set number of directors between 7 and 9
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">11.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Provide indemnification rights for directors and officers
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">12.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
Restate the certificate of incorporation
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">13.</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
A proposal to ratify the selection of PricewaterhouseCoopers LLP
as our independent auditors for 2003.
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="center" valign="top"><FONT size="2"><FONT face="wingdings">&#111;</FONT></FONT></TD>
</TR>
</TABLE>
</CENTER>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">In their discretion, the Proxies are authorized to vote upon such other
matters as may properly come before the meeting or any adjournment of the
meeting.
</FONT>
<P align="center"><FONT size="2"><B>Please sign and date on the reverse side and return in the enclosed postage-prepaid envelope.</B></FONT>

<P align="center"><FONT size="2"><B>(continued and to be signed on the other side)</B></FONT>

<P align="left"><FONT size="2"><B>&#091;</B>Reverse<B>&#093;</B></FONT>

<P><FONT size="2"><B>The board of directors recommends a vote FOR the proposals, and this Proxy will
be voted FOR each of the proposals unless the stockholder directs otherwise, in
which case it will be voted as directed.</B>
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2"><B>The undersigned acknowledges receipt of the accompanying Notice of Special
Meeting of Stockholders and Proxy Statement which describes the foregoing
proposals in detail. The undersigned revokes all proxies heretofore given by
the undersigned with respect to the annual meeting.</B>
</FONT>
<DIV align="left"><FONT size="1">

</FONT></DIV>
<P><FONT size="2">Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, as executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
    <TD width="7%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="36%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="50%">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">Dated:</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">
<HR size="1" noshade>
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Signature</FONT></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR>
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">Signature if held jointly</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2">PLEASE MARK, SIGN, DATE AND MAIL THIS PROXY PROMPTLY USING THE ENCLOSED POSTAGE
PRE-PAID ENVELOPE.
</FONT>
<P align="center"><FONT size="2">2</FONT>


</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>3
<FILENAME>g82690p1g8269001.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 g82690p1g8269001.gif
M1TE&.#EAP`!>`*(``/___\S,S)F9F69F9C,S,P```````````"'Y!```````
M+`````#``%X```/_"+K<_C#*2:N]..O-N_]@*(YD:9YHJJYLZ[YP+&]!;0OX
M,.!",/]`DVU(Y!D%NB0AN?,%GU`)L7BL\IA*@E:K<T:_L2G52CYBL=OMP`MN
M@\3BLGQ^9J;5`K>>`1_/`W.!9'59=VE=>S]^@HR-CCEUAI(Z>8E"<%6$28]&
M@#R>G(.:A7=);)86?:"0:))+3*%'J[%6HZ1J.@25J!!#9F>NP5QGH:LUG;2_
MD<.&2CV)4T9VPM3"Q(RJ<7+`A@7>W^#AD[EK+=F8F=/5Z^.P5L<]-W3+KM[U
M]NR'Y*<C\+](CUKERW?-D::!"!,"*R<$R:U7E!BI2Z@&XJAT].[AHV;K_V"P
M`<.P"%C"#P02:Q$E3OQXL>/#<#`+N+IH4&"SCCA(E@B`,J4@EQ$I$1(6<R,N
M=U70A<+)RB%-1/U&LO2IDA6W>@2*RKRY"5NT9**NSA0)J62'`"#;40T[E*B6
MK5G7D97CKP^MML&T%I@+T"P'J4<).<UX+^LWB@7!*L[U5J]C>UVE/1,!Z-!@
MQFD>(W[(-?*[GU=W#')XQ?!C<&-'^]50F9DX?9ZM8K86$FALPJ9/>Q-]96UO
MA(++-(G:$[3MX^YX2TN;^S1+3LP))LXT.41KKHV0!T4*,/OLL4"[UZS(W&6@
MX90!U_8MZO)#]LN%[U!>)]`LR=`#:Q=>_<U(FO_;_-*<.+$IUEL\VMP'VCSK
M>=2,:L0%"`M5\XF6%ERX&+@-2**=4PL=H\VF&VK*2;9:!I5I*&`I):IHQC"R
MV3):#C36PAQ,,UG$WXD8`-*BAI@5F-T5-=K(137VR/2C>$LNUQ-??T3HXF\0
M34E'9KK!E\,2Y[$XW4_]?9#BE!:&).%\`5FX)7CUS4A.D>GHQYU$87K@8Y-@
M!6FE4^+EQ(4LL7R9B7Z*\7B!CT22":,90[HG!QYW]3;G('+*2%=403$YYY=E
MOG(F,5HJ8]D\U,E6Y89'$G1I>CYU:ANC)WG*5IO&D<);A9/::"N#`^J%IZ&I
M]$EE@].TRL.BN@J*T7?_2"J)9ZRY@/,L9D;-%"6KL)8G:7!%(EMDL=I%XMR2
MG;YBR'EI_0C((HP"2\&=^$5GDSZ)IDMN(>&V6HI%4-88Y#C".AGJ>;OX9VRL
MJM;K;7?J6)A<(Y8)E2N-S-[$Z[,$8YHMEGIQJ;"L1+:R5I.^C5JJ<')A#)C*
M.[)*WYKLD+MPC$(&!)O$Y)96:<V#>NP>SWUA6XN<ZZ$,,L7EJ9FH;/)!>O+2
MT<G596-:T2=QG1S`NRQ3\=IKI)F+<>1F/OA,>Z$UR\'B[@2(AN@OG!LO7.&#
M_,$JS1WAA)HOQHRI7-_:4@0\(\$.92A9Q=MJ$K>U\YC',B1_;OAW>KKL*>^/
M_T%V5;'A'T\"YM(&OBDY,8!'T';H=W..M-/I-`7)T'0OA>;`1G>XM4BE]S)2
MW=MAE+KJP]JNRM,P\[NG06L"I6/N#U36XN.PF_F\MHU/'/71QWNW!8YH*,&0
MP4HGP^RDWW'F>?098KXW@)12?9C('#+OP.DE0G\+7.KCO95F,F<F5/9IFHH^
M=&(=TB1K5AKQF3(VEYHRQ`Z`-N.73?9!N<5)T'Q>>AX`358_T*&+:Q^"EEB8
M\3TQ_0=]%*D-!)=FLFQQ:'W<:IH$;T)`_RA09SL+SPJ_Q;KV77!]$M$/#4MH
MIQ/VC%C[&1+),*<SO74&AA-KXDK,1<2S&/!%*42)X/_RA,.<%<\TC>G5B&X8
M/0P=I88FU`59HC.BQ]RJ0@'K':/T-3,F=4,W`T&3#,T8$C06L7)'W$P,ZQ9"
MH_U0<WD<Y.@F5#BU<*A@?_1A(FE')GE-;2K]4E'%NB>_!CCO:RRYX`ZW58HK
M83**GT!&!&]&P0+F\#BC)(S:%-3(0_XJ&]"YG.9V0+DL^O*7U<#-$Y&3IGR]
MKI?;:Z,RE\E,U!A&C#@"IC19Z3!(6G&:TVRF-K?)3>=(\)BN5(CBTC9%;)KS
MG,D<H_'`:<.4T>J#MD&G.S-9DWD]*2640*;CH)>XXS!#G@WZ@RH7>3UJ3J^3
M?%`/$!<(Q882$QLJL2<26X?NS%,"[6<.S4A&45E/8_ZC'\&DY^T`BDWO;;2A
M%*5,00/:T5&0%)BV6`))<Y5/D#J2GRY]:4C?^9E4+G(S=2L!P@CE'6'J])Z4
MC*A$D;A$:YJ0?;4JYU$MFE1X+I6G'T)H\^[$T5GE=*K#Y*=\EKHS4FE5=U"]
M"PQ_J:Q`C3"#(GW=64U'RY9N]#(&G!!6-4G6LFX(:XHXAS_L>M*N$O:A\@$L
M+Q8@6+NX]55JA27MF##7Q1X*`((%H,,@&U$<6/:S4FCL8!F*4L6"]K0G$*T8
A4,O:UKKVM;"-K6QG2]O:VO:VN,VM;G?+V][ZEK4)```[
`
end

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>GRAPHIC
<SEQUENCE>4
<FILENAME>g82690p1g8269002.gif
<DESCRIPTION>GRAPHIC
<TEXT>
begin 644 g82690p1g8269002.gif
M1TE&.#EA_P%[`:(``/___\S,S)F9F69F9C,S,P```````````"'Y!```````
M+`````#_`7L!``/_"+K<_C#*2:N]..O-N_]@*(YD:9YHJJYLZ[YP+,]T#05,
M@"^[[?_`H'!(+-H"A1VA4!@HE@6!<4JM6J_8[$C`Q"$!R,"``.!JS^BT>LU.
M#;C>))P@!23;^+Q^S\?>`5!D=`I_#3J'B(F*BXR-CH^0D9*3E)66EYB9FIN<
MG9Z?H*&BAQYW8V!1@W8]8`%<3+"QLK.TM;:WN+FZN[R]OK_`P<+#Q,7&Q\C)
MRLM1I3@$3H`"`TYA#E]]V=K;W'JJ''=<`G#BI]<%W>GJZ^Q`WQL".P+0=?/1
MY^WY^OO\(.\OV/H)'$A0X#\7`0LJ7,B0S\$6"1M*G$BQRD,6$2MJW,@Q_\;%
M%1D[BAQ)TE^=&"%+JES)\L%'%2E;RIPI\F6*F#1SZF1H$P7.G4"#ZNMYXJ?0
MHTBU$35A-*G3IVN6EF@*M:I5BR=A4+W*M>L/J22V>AU+U@78$6++JEU+XJR(
MM&SCRM7@-@3<N7CS0J@+XJ[>OWKY?O`+N'!<P1X(&UY,%G$'Q8PC7W7,`;+D
M=O<NF\VJ8<`.,:KLL>*!3O-&<6=T5!4\X`Z2<7*BF#-4VG1%6&<(D('*5W>X
M:/&@$1J-RG;%5\VPO"(NE"^..[X+"*I3B+1QBK)T:\_L:ISW<:P:&?H0B#?G
M#-`)Z$A%/;RKY./`Q.\NWTN\,O?!X\<1'[^"^?\`2N&*??SE9V"!_]4C8(#U
M-:C?@P8F*"%]%-XWX'X80BBA?Q4N2&"&!_K'(8,5?@AA@0B.N."*#5X(86NS
M^$9&=U#,\D8<M12(7"RZS3>&=D#"!LN-(*9(XI$FAJBABO*Q>*&+2D;(9(<M
M1HEB&8B9$@T=JE2G@#6M?/G9F%^*:6:8:*J6)IEIGJGFFVS"Z>9G<]:YIIUO
MXAGGGF[RH.>?=X+A9Z!R$AKGH&_6&`N?A/+`B)G?>4>-FO,`J=T\/#):Z*9T
MEFDHH)LBJNFH?7K*Z9=9\E>:;&28@<]U"L%(RWE#[,@$K3NE^@036][Z@&6P
MXL&%HK)81`ME%"%[0P3_P`;+QGR/3F%K=LS-I&P&S3J;17]M5&HI'7`TARM(
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M/%%;SE;EW/`%8P_I`D`-*L35S#*FR07+O.]4\"7%']0,TF7RFN_N4O/FSMV'
MKF98OX.7R/])ROFJG?IIF.A[D3ZIG[;?BON@\BD_^O77>?_[^=\IAOL`7)_Z
MWA=`_`G0?@2<WP'-ET`##A"!!>0?FEHS(U+MCWX+]%\#)9@HZ-VA"95"5WMR
M\!X%;0A`23*2"474GQ9ZR$%2<N$)5XA"&*IPAC@<40I92,,>3LA"4<IA?X[G
MGS>\$$HWY*$0CQA$)3I1AD]JH@R?:,(H7FF*6/2A%?]!-$,I9/&'._PB%<%H
MPR>";QRZ$4,UEJ8\6$EG`:^`',#`E`5=+6`02%B"YS*GO08LYW608P+"*)@;
MZ(WF3:OC8Q\7D!WHF0M&-8(=RAQ9F>S%;4=[A-S?!*D%T+71-$C@41]#"0M)
MUL"3EOR:K$JIO56^$0NH;!TKCK4[4BX*EI3<P"<+@REYY*AUKN3D%6*YM[]]
MPUN6,B7$;(%+1R4B8Y>$PAL6V8UO$.N52D-;'E%'S6U84Y"BS";G<I#+;EKA
MF[LQWKS>=K)I<,^<GSM)U!A`M*FD\C*ND*8RX8FT.V(3$/\DG+[<*9UR\K.3
M\OSG/.VIKXH=E!_H9,!"V1G_+%88]*%32V@Z[=`$<=I&7A?%:#]WM9N_A31T
MFF'>W40*T83&J"CW7(LQ3\I2-7Q3%IETW&7TN,^:"LZ9I(!F82SJ4XD0,R_R
MVFA1C4I3D<54;/I<:D6.*E-(<E.J3'7&KCH*T'<JDBV]PRK#+*>V>:`"C65@
MXU-7@BZ5]52L7+/<&URCA'F,T&N\:1ZFX*H2.RJ@-=(8CNZ00DICYI2O4^6,
MMU;:@$*TYAEW%9/=GE`-/`["KECR(L),-@8<F(.(PA$A&"Y+6LWR9Y"H_>N6
M*BN@TF862Z?U;&J-M]K1MI9YL"!M;(TW6]"RUK:OQ:S).-O;VHI6M,+5+6QY
M*UO5_U(6N,AU[7!1VUS:/O>XTE4N<:OK6^AFU[3+[2QOG0N(WT97L^#=[GBM
M6U[OHC>XFZ7N>KN+W?<F=[?B;<U)%!>+PZ[B"0@+['_QFA1;D@^Q-7$IN/H&
M@7"`,![E4.I7C\+?=2*8)*&IYU8C@-I+\9:QN^1'+2[<USH,CP%JHRA2KNE5
M$LNL#E"@38L3LU:*@(:>(W9Q@C=LMAD_IL8->1X)%Z'C':M38RE&"Y`5XKTB
MYZH>%HXQ0UERL*8ZN1_?&%(^-:SDEDSCK5>^&&E>ZE&.B"',YLG!&`39U!"O
M@7E@1O-&J#J1Y\59SB^>@9NU8%4\IUD&>\8"$ACK9W'I>?_)?0A/H:U"9WZ4
M<-%>:70^_D;H#M1"PI#&LI5IAN@W1]4$E\XTV3;],X@65`6A%C5!WM$CC'0Z
M#8DL0:I5W38<DQJEW'"%?Z?R'EK2NM:,]'&7<\TOGXQCS;F=]:\99VM7;T.E
M=];!L15%CWB,S]?+9G:P;QUHN86U,C2BMA$GINQLQ[79Y,H&9O&EZ^A(AQYL
MJX`M;FWN(;S#PA/H5Z7J(;E?O9H%/_H6!ATV;1Z!*]XCT&^]S[UMARTA#K!)
MZS0PW6VZU&+-N.H.L@4Y[CM?0.$+5\>]A7W'QV+I"?80+(&-=6D!A9M'XP8"
MR$,>O*P(,IF_^N\TI7&]P9KNTN[_UDW,IS!SFF=CY+-8&'1@O.[J2)NKH;6L
M?;4KW\\:5^KPE0*+>15']D;]MEE?KGJM?EVL)]>+MQK[;NAK]NSBM[AE!_O9
MQ5[UM5]=[FX/+]S;6]^P3U>VW+T[<.?^=^;.5_#GA>_;`Q_WP>==[>3]NN.G
MOGAU9B52WE$Z?[;4=.S!\I=L*+K1O>%!5:WGQJ0SV^=ID:(TB'[T;;`CXKI*
MJXIG8.O/"2B?20[[.M+;YT;`_892M_O?]YY=QE?]%<2S%]U3X?7'1^BAN3&-
M,T`_^L-,/NO4,89*_^#ZV(^>]B><#G=:`?SA+\([@@J3?ZMA&N//-^_3[PZ;
MSW\P[H=U_Q>(@'[ZUQ_=[5<06>$*,G=__C<#(\=M^9<'258#)G>`ZF=_"EAG
M3^-QG7%@$&@#">AL9G9J,O"`&?A_#9=N';%N'XB!(>@1$LB!*[$X+0""*4@#
M&TB"*^$T+P"#,:B"`"A4+<$*.\<#?>8!.)B#FX%C25=F-"%,J(!3'S"$1+@"
M2"<+%KA].<$M+.9(3OB$*"!I.W%Q()"%6E@"7*@3Y<8!8!B&(C"&.>&%=I`[
M&W"&D^8=YJ2&-!%,KF&"6.)]#`"'Z^!*\6<8=#@3!L95$+!F/2`&5[4`?-@-
MTX*"AJ,L]/$EB4A^0@$:'N@NQ0-'8;.(WD0+N_8#T/84R))'NO^!"GKD;Y+!
M"E)F>5-H!8>0:G(X!,'4B@V!+&:U"L<3$K8GB#ZX?X.B`>R'$A8U&TO8B*^T
MBL4H4?^$B.[Q5H/H?$_F`"&$+[*!#CVW<LY2=$KH<+%@9;&8.=PS4?5184/"
M+/H!1T3T'[[(8^"8%4)'3@1UA"MV'M)$C=HQ8.0#)@^D0/N801O4/_OH0/`3
MD!PTD'QB<CKP!OV25&&3*+/0D&2"/]U!/\*D`RXCB9EG)@YDAW70C__(/OUQ
M".MFD6GT)9#T2QYI004)D!#DCP;)CYKR#[84.*#5>23T,5!40TC$16,T)4!T
M13'D0SX91D&Y1$U2)4"91%]$(0^WD]/_-D3208ZPT%K5<!^G"!YEY45BA"1E
MY!T\LI5.\I-%TI,YV5J_M"1@>91;=")D644Z:25M^4-,E)0L]`\4A&\14).Y
MJ%80\W#X,@;Q*(5I51WOZ"B`-HE7@VU'\0^\(HX28#</!YF9M(M)X9<98(=T
M18O\,"U>`#K5='E=H#4#<XZ1"'SF8ID78(Q(,7']-EH&:&0D10B$J&)]Z8@/
MX(E>@9@M\0W/:)NZM(!Y@9H.PX15I9D,=V0/B82U*4D9R18-6&+!IAZ'X)@Z
M93/"^5&?.&=0QCVB29LG<YT599S>Q&]*A2[W0IF3X9N209UY!FC`61C@>1VI
M-U;3]S7QJ2WB_YD'@5@P]QDLK29F[KDW_2F?I0B@*/&>C#&@UZ%H"[&?&Z.@
MSN*"JQ9_Z%D6$`HK_<<.#DHR%[J@^>E[_M1(,%4Z'>HL_]-2(2J/WOF(ZNDL
MSQE/_B2=O792%0I6+>JB'QJ!,;J#`K4[);HN!"AR&G4(L[>BFY,N1$8RPR*D
M*1I.4Z8]PJ>DV1E["C:5/H&@UQ&E3/.'*A!1A36B?:2E07.*#J%1Z@B-#@!)
M6U5[6&H<8FHS-U:F.[JF%.`J27`*\TF)HO.FFS-Q>FAO9@J.MDD-^G&-R@>E
MH!=(GN%*4_H5)_&-^*&;)+4$^.AY89JHAF.,KWE*N52@7#(^[C%9?/\G>8E7
M>)^U&[D3=>;U>+V%JE>WJI2G=W_EJF4'JXHGJ^N5JI5EJ_>%J^9@"[Q*==Q%
MJZ,:K.G5JL]5K.YUJ\0UJ\FJJLO:J\V:JZ\:K<(Z7\2Z=3/"JL/ZK+MJK<?*
M79M:B)R'1_G8IK81<$`RKLN48^>42Z]!#JR"B@_%B2=3AL%73OOV'ZV)C?!$
MJ:)CAXVJ@12*KO!2H)I$9ME7GQ@U:*+#7W\:!!LJ2[-I.`CWKH;P'3PH4A_C
M?^_@2IA6G35EK_5V3!Q7C\J)422;;=]`2.QHI!B%L.%GLB"D0"DK4C(;?;PI
MHF"Z5`X[LP-(+`-+C6+5L<?W$/%(BS4JG^S_"FG?=`\OVA<&:S,KFVDWM0,G
M]J1B]:-6^ZB*.6Q\E;,T]PZV$K)2BV`_.WH'@0@;"U=I.[8%2V)&NW`3BU&U
M$W)UJ[(WZF=Y&[-FJVI]Z[=X&[=%]K;+UBX[EW+T6F1S2VO7@AKB(+:XIF.-
M*VJ0>&JA=:YH5K4ZIBQ<HG61185%QKDD9HO34:DW"1]A.9=CB99N&99$"90X
M1"5K"9=+R95.*46OJY9BR9:N*Y>\&[MIU2I:A+NV6Y0^R;J^B[Q'HKS'.[O&
M2Y>_F[Q(V;K,N[K5N[RGE4OO5E"&2AHO*2@N"9`L2;[CZX_EB[[GZY%X,BPI
M62KOJ[[QR[[K.Y#I_TN_\VN_`C2*%KFHK<*7>&:XB]8NYIJ)_GIEE8MG*7.Q
MDXMF"8QF@8M5I+NUA#O`?^MD$;RU%]RY%;QH`AQF&2Q6LL.W'0QI#^QB(0Q7
M$UQ3*:S">RM5+0Q7DHO")2QJ>03!-6S#%4O##+ML)RS#.:QJ/XQ5,8Q@*_RO
M0>RX4QLW17QA,TS!/5QO'PS%`6IT4PS#2>S#3=M-3>QB1PRE69QM7]PZD,@M
MI7G`>+O!,0NON(,.@[;##6QT:,I2R`)::A3'2PM/5XRS%Q4&WZNG1C?$_'0M
MG8.ZM/&2`GF_$;F2]:N1C)R_CHQ!D*Q!DAR^IY+(C=P*XE#)BAS)F7S)C_]L
MR8O,R9\<09U,R?M;3C_[O4]7O,XKNW%9(EUYO=#[RCR9EK*<NTKIRMFKNT:9
MR\\;RS6D<,MKE$,YR[M<R[T,R[C\EM(KE&6YS+<,S;"+S'7)QO>PEXL[LTO,
MG[E$06GTQI/9S0CVQ(,,KVQ[E-L<?GL\AV$\>NU,35WL9X(,QE%,?V/,-/-<
M:/ELG>]\M&I,QO]\?'-LSU6<@H.&>5SZ%_L,:?AZI`--T%]+HA'=>P\-.0V]
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MG1J@#=M`,-H_H@O-!&J@:II4X-IV$=JQW=K+UYODW`$-\P=.UVO,D-S*O=S,
MW=S._=S0'=W2/=W'0%/F>@.CD-W:O=W<W=W>_=W@'=[@;0OBK0EXK1Z:S=A(
M@=K]T'V\K=[ZD-<+#=_T_UW?]GW?^)W?^KW?_-W?_OW?\5)2%(2U:$1:VS$#
MB5N8=L!;JC#@]9E4!%XIP/&?'TB>]R`'_^G@!TU!"B(OF1%@,M!"9`H(^=3@
M%,Y+Q^B_*!<%(B226]P!"O<:YQ4%Y(#>`3TZ3*!:\O($@];B-/[B9M@,,AYU
M\8KA<:H5.<Y<KL(EGF%9+RP",<[B1/[CH/$>[ST2@[8;%N+&ZE$:M]A>,;"O
M07H\;Y"J:)6G+-`$7AX'R./E7$)>:=-J8]XJ"HER?YSF@%4&<?`<_V56T`#B
M<3Y-<UX&98YR8?/D:Z-4I?AEIJ#EB!X"Z]<,Z!T-+"X=0%Y)#8"GGF$*45`:
MYO^,?&:C=8AHYZ&+$!JCZ=@0$(`.`S$C.^#">8HXW"S15G>$JEIGZ7;'J:2Q
M1J9X*YV5YV;]5Z9PZS&F'06]A?O%5=;(='?.@NKD6?%0&JI^Y6:L[(2.<L)^
MY25!ZX"03M(N;;OQZ)`.9?40#=/Y,>+^8[7.2`!D5D0ZM&D(9<#A!-7'<Z4.
M$;7QV$E@#5^^ZFG3D5QE5K<X"/W\%+2.I/F$/+*SB^;J&0FI66EE77<+$)[.
MXA9)",$1[:>'@+?C\*,NKPF/YARH7]/Y7&[H[W'=\42ZVF%`\MI.$FUE8(E;
M3U_.\8,)3C%JEI?^F[(YE<!13\5F\SMBF;-WD56,4^;_+HXHWP+Q,?0!ACB*
M\O(`/O547_56?_58G_5:O_5<W_5>__5@'_9B/_9D7_9F?_9HG_9A[MALW_9N
M__9P'_=R/_=T7_=V?_=XG_=ZO_=\W_=^__>`'_B"O_?C9P_4</B(G_B*O_B,
MW_B.__B0'_F2/_F47_F6?_F8G_F:O_F<W_F>__F@'_JBCSDUK_:`0?HW;OJ-
M4?BIK_J1QOJN#Y^P_SO/-#]LJP@H]H.2.$<,ZAZV;T`W<(Z_'QY?9IB&6?O7
M0"1BDL[C8?S'C_O(SS;%3T(T,W!HTB12;SJSSQ)_30%^V%7EF)P`9?3@_$HS
MM^_8=`I*;0>'%35D*O[#LE#`_\[^')5;H^'^4%<L?D2(!HP`4@/ES]X38!0`
M5"$;8Q=X(F95BT<P`$=PU`C'\DS7]HW#Q)OWLT#P"8?$8E$B"?D&0=*E!3LY
M32B&XA4X62Z?0+;P8JZ:(JF.H+PV5%0U(``M>4X%99:]JF/4*5J+FT?&$8'7
MA1)4<H>AF+%1*%*RI=3'H21GA)FIJ<.S>0/D&2HZ^H$$(B2V]T0VQQ:I]Q;2
MYZ%0,=B556D[%O7X!B8B$&(6R:H0<+G6H+3"EM4)-1N3]8S!H9=+&,4L]AH<
M-I`\\@K57+W82:J^;IW.3LOZ+J\97F]_'V[J@,]?;XD6`$@0%BW0-$B13P6+
M`2_,_/]"M@-8G6=Q!FXH.,Q7K45>AB&TP$!:EV1TA"$#M@C6E((MTG5K4I""
MP`@LFRRHIV75-##G8+Q2E(+:O*'J=A"%=S2I$#@UF[+4=]&I4Q5;]LGZ.,#C
M'SP"F-#!0ZW;A8EDNP[$FC'&QB]T"DIQN(QDA`<BA7HHT<+?B`4GKXK9T<=1
MO0]_4.*-I\I+.9\7?@95J33R$*-)04F^O`DJLQRI1"QN94V/`!ZU1!Y+M8!L
M")!G>^V$IHW7+EIU-GZ@`%E$SUTB@T4]T8+:D]AEE'2@TCE#R*>;[S;F4C`K
M2FO-,5M'X4Z>Y>O<?6A&A?CS!Q6*F%AZCJ5#*@U>8+&07<;_UQ@[@<F?<,/K
MW+%E,X*KHM!;%<[Q<DM]VZ3$0")2W&&7,HQ1\0MP9%A077>747;4=A9N2,-W
M2X2'1!#$\.3`'V%<=%QG%-J52QX2B"@!6`1MD)83JZ%H4""W\-<?B@KYTA-%
M0?`QUXL\FG"2$W\@PDH)#GGC!`-?F/@+AYAA2)2&5F[I04=>5FB#%S!\*::8
M7:81SF;(,'2F;HOH%@*9<7X)0U=L<@3G(N&D8R</8`:39IO3C.#EF['$0F=S
MA>IYIYEXWHFGHX?N$:BA7":%Y5!:7LIIIYY^.E2.H'Z:Z3R;CHIJJJJNRJJJ
MI6J'6*NRSDIKK;:.\NH[I][*:Z^^__Y::Z[L[`ILL<8>BZQUPJY#;++./@MM
MM$4LJTZSTEZ+;;;14DN*M=I^"VZXM'([BK?BGHMNNEN2*XJYZKX+;[RA9J=K
MK/+>BV^^H;`;BKOQ!H2)5P'"<5PP+&5E,!Y]@,)47LP`L8]N&#(1G0R-YG57
M2_INO`*]P]J[L2Y$*)`52".D@%^4X7``B0.T(7+!'2N+QI<"$Q:<5SZ(F;P&
M$`F"02''^?+KB;_O3EF$BH4$-]T4*7'CP(DP5PF:&7`8%S1\XGQA!1>E_2@T
MOD1O8C2R<DKZY360G5VAS<*H%?$X@.RG\GA39P$)&KFITHPU-Y_,1()-"/>"
M>&&K.[8F9?\;RU:(+>O#BMI(R-!5B6I>8U++A>%A02T^WPV(+0UZUG5HA77R
ME^!SV)7<X8A[S"S(U[(-IV)(,$/[F&E\)I9((#'4G)-=F44%WH>,3D'CP.3\
M=I<WM92*</^X'F_BF2PNKO(%]R"-;7WG@7KH<E=`H5A4_P*@,T`#Q!1\A+J%
MLM?#62,?]>!:CPGVX4K^P)\S@#2:[75.`TT27\L:P:3BW<0KJLB*S1S4B/;5
M8!9\Z<,`]V:__<&N6K*3%\5JLD&+7>,1%@B*J(AE&:-T)0-!:%A0X!&QJY$N
M'#:X$\1<L8$09O!:^#."_G8(Q"`:JX=%^*$0CXC$<>FP71U,HA/_GQBL)?:K
MB5"LHA5'1<214?&*7.PBA[(X!"-Z<8QD?`<8A2#&,JIQC9HXHP_2R,8XRC$'
M;NP!'.>(QSR>3(I%VZ(>_PC(&-0Q!W<,I"'+.$@<%!);'2G"FO9$*7NLYAZ3
MK$=V(-(H2AH,0\U[@Y3LP<=#^BJ1G_"CNC00-U3\QB(LP0T(#^*60I0P(;]X
M2O($<QQIX"T72Q(EMDAI@T5""Y40&$)G2H,8N!PI.3TYAO'H!Q^@J.]\H_.E
MLX!9`V$^BW^G^!!MW#>>`_DM;X0ZGS*:AI=I/K.:UD06-FF@S58Q!76?(1CD
M)":J,;CB(QW@WS`F!\MK;*8<CVP/_-JS_YFO.>\7.#%@.X_USA^8\ECSS!LK
M[&F*B_KG$#C,2^'8A[5%@:%RP6N"0%0#L3A!1J$IJ:7#'@JMB%)NHN>J"EV,
M&9YD/L(]*X4,6>9@$X6UAF_/A.FV0JDXFI[+%/[[7T[IQ)="P8(10$W>BN:6
MDQ/)!!CM*ZI1MXG4ZRFUIE8A0NM<=%-31`!JG<#H"8H:-)OR0&T&\>I7DR53
MM8SUKHW$@:0XTM2[0C2L^=NK8`^;P;S6R;"(;6S8%#N">#IVLNF"K,$HB]DG
M6A8IF>VL$#>[!\9Z=K0:5(ID28M:=Q+6AU!IK6M?"]O8RG:VM*VM;6^+V]SJ
M=K>\[:UO?PO<X"D*5[BK=23;CHO<Y"IWN<QMKG.?"]WH2G>ZU*VN=:^+W>QJ
)=[O</5L"```[
`
end

</TEXT>
</DOCUMENT>
</SUBMISSION>
